People Should Ask State Governments To Reduce VAT, Says FM Nirmala Sitharaman On Fuel Price Hike

Sitharaman said that the Centre had also appealed to states to reduce Value Added Tax (VAT) to further bring down rates and some states have even slashed the prices

Finance Minister Nirmala Sitharaman (File Photo)

New Delhi: Finance Minister Nirmala Sitharaman targetted the non-BJP ruled state governments on Monday when she was asked about rising prices of fuel and why there is no reduction in VAT. While addressing a press conference after her meeting with the chief ministers and state finance ministers, Sitharaman said that People should ask their own state governments about high fuel prices as the Central government has taken the initiative by slashing excise duty on petrol and diesel.

Sitharaman said that the Centre had also appealed to states to reduce Value Added Tax (VAT) to further bring down rates and some states have even slashed the prices. "Petrol and Diesel can't be included in Goods and Services Tax (GST) till the GST Council sets the rate for their inclusion," the Finance Minister added, reported PTI.

 The Centre had reduced excise duty on petrol and diesel by ₹ 5 and ₹ 10 per litre respectively on Diwali eve. Several states had reduced VAT to bring down fuel prices. However, some non-BJP ruled states have demanded that the union government further reduce excise duty.

Congress-ruled Rajasthan Chief Minister Ashok Gehlot on Monday slammed the Centre over price rise, accusing it of "looting" people.

He alleged that rising inflation is the result of the Centre's wrong policies and sought a further reduction in central taxes on fuel.

Addressing people at Bhilwara during a camp held under the drive, "Prashasan Sharon ke Sang", he said the Centre wants to "please" people through a reduction in fuel prices when it is "looting" the public.

He said in the past year, fuel prices have gone up by Rs 25 a litre.

The chief minister demanded that the central excise duty on fuel should be further reduced so that inflation could be controlled.

Similarly, the Finance Minister of Kerala called the centre's move "damage control". The ruling BJP's loss in many seats in the recent by-elections was also attributed to rising fuel prices, among other factors.