TS not to reduce fuel prices
Based on latest rates, petrol in city costs `92.26/litre, diesel `86.23/litre
Telangana government has no plans to reduce petrol and diesel prices in the state like its Assam counterpart. The BJP-led regime in Assam has slashed petrol and diesel prices by `5 per litre by withdrawing additional cess on petrol and diesel. This was announced in Assam Legislative Assembly as part of the state’s 2021–22 Budget on Saturday.
Petrol and diesel prices in Telangana are continuing to break all-time records since past six days. On Monday, petrol in Hyderabad cost `92.26 per litre and diesel `86.23.
In January 2015, TS government had added `2 on every litre of petrol and diesel to the then existing VAT of 31 percent and
22.25 per cent respectively. However, in February of the same year, it removed the `2 per litre hike while raising the VAT rate to
35.20 per cent and 27 percent respectively on petrol and diesel. These VAT rates have continued to remain in force for over six years now.
In 2013, when petrol and diesel prices peaked across the country, the then UPA government had appealed to all states to reduce their VAT on fuel and lessen the burden on common people. Following this, then Congress government of undivided AP led by Chief Minister N. Kiran Kumar Reddy reduced VAT on fuel from 33 per cent to 31 per cent.
Now though, Telangana state government has no plans to adopt either previous Congress government’s policy or the latest Assam government’s initiative. Official sources in Finance Department said the government cannot afford to lose even a portion of its own tax revenue, as it has already suffered loss of over `60,000 crore revenue in 2020–21 fiscal due to Coronavirus pandemic.
“The state government is primarily surviving owing to VAT on fuel and liquor, as all other sectors have taking a severe beating due to Covid-19. Taxes on fuel alone contribute more than 25 per cent of state's total tax revenues. The government earns `800 crore per month on an average through VAT on fuel. It cannot risk losing this revenue when the state’s current financial condition is adverse. As is, the government is struggling to mobilise funds for its welfare schemes, development programmes, and salaries and pensions for staff. For this reason, no proposal like Assam will be incorporated in the upcoming budget 2021–22 to reduce taxes on fuel,” sources clarified.