As the Opposition blamed the Centre for hike in fuel prices, Union Finance Minister Nirmala Sitharaman said both Centre and States levy excise duties on petrol and both governments will have to work out a mechanism to regulate prices to reasonable levels.
Replying to a question on petrol prices breaching ₹100 in major cities and towns, Ms. Sitharaman said the Centre levied fixed a amount of excise duty while it varies in States. “In today’s context, prices per barrel of petrol have gone up over and above $75 or $76 so the issue of price is fairly layered…”
Asked about why the Union government has not brought fuel prices under GST, the Minister said the GST Council has to take a decision on this. “There is no hurdle on the part of the Central government to bring fuel prices under GST.”
On the rise in price of edible oil, she said: “India’s dependence on edible oil import is very high. Prices went up after an impact on edible oilseed production. In the last four years, refined palm oil has not been imported at all. Now this has been opened. This will reduce the prices of edible oil.”
On price of essential commodities, Ms. Sitharaman said a group of Ministers was monitoring the cost. The government has given gas cylinders as well as ration free of cost to the poor. “The Government of India is conscious that prices of essential commodities have not affected the poor.”
GST compensation
Meanwhile, Home Minister Basavaraj Bommai on Friday appealed to Ms. Sitharaman to release ₹11,800 crore GST compensation due for the financial year 2020-2021.
Mr. Bommai, who is Karnataka’s representative in the GST Council, met the Union Finance Minister to discuss the release of funds by the Union government for several Centrally funded projects.
A note from Mr. Bommai’s office said the Finance Minister has promised to take steps for release of dues. She also informed Mr. Bommai that the Centre will raise a loan of ₹18,000 crore to pay the State’s GST compensation this year. During the meeting, Mr. Bommai also appealed to release the first quarter GST collection due to the State as early as possible since the money was required for COVID-19 management and to prepare for a possible third wave.
