JAIPUR: Chief minister Ashok Gehlot on Sunday said the government would convene a cabinet meeting on Tuesday to take a call on reducing Value Added Tax (VAT) on fuel among other things.
The state government is under intense pressure from the opposition to cut VAT on fuel following reduction in excise duty by the Centre recently.
“I have written to PM Narendra Modi and Union home minister Amit Shah to further reduce excise duty on fuel to stop the competition over prices of petrol and diesel among states. The issue will be discussed in the cabinet and whatever is possible will be done. Every state has reduced the VAT differently, which has created a big difference in the price of fuels,” said Gehlot.
He accused the Centre of increasing the fuel price by almost Rs 25 to Rs 30 and then slashing it by Rs 15-20. Explaining the fuel mathematics and its implications, he said states are already experiencing a slash in their revenues due to the Centre’s move to reduce excise duty. “The reduction in excise duty by the Centre will lead to a revenue loss of around Rs 1,800 crore,” said Gehlot.
He slammed the Union government for disrupting the principle of cooperative federalism by challenging and changing the share of states in centrally sponsored schemes. “Earlier, the share used to be 80:20 between the Centre and the state. Now it has become 50:50 and puts additional burden on the states to carry out development works,” said Gehlot, who argued that the Centre should understand that states have limited sources to generate revenue.
