Kerala govt stand not to cut taxes on fuel criticised by Congress-led UDF and BJP

PTI, Nov 4, 2021, 3:15 PM IST

Thiruvananthapuram: Kerala Finance Minister K N Balagopal’s stand on Thursday that the state cannot reduce its taxes on fuel in the same manner as the Centre since it would lead to a huge burden on the government reeling under immense financial liabilities was criticized by the Congress led-UDF and the BJP.

The state Finance Minister, while speaking to reporters, said that the Centre’s decision was only a ”face-saving measure” and it has led to an additional decrease of around Rs 1.5 and Rs 2.5 in petrol and diesel prices.

This has led to petrol and diesel prices in Kerala reducing by around Rs 6 and Rs 12, respectively, he said.

However, the state cannot reduce taxes on the same lines as the Centre since the Kerala government and its various bodies, like KSRTC, are under immense burden due to the rise in fuel prices, Balagopal said.

The minister further said that the state government has also launched several financial relief packages to those hit by COVID-19 and the recent disasters as well as increased the dearness allowance by 6 percent, all of which may be affected if the taxes on fuel price is cut.

He said he would be coming back with the actual figures of the implications of any cut in taxes by the state. Responding to the minister’s statement, BJP’s Kerala state president K Surendran said the Pinarayi Vijayan-led government was ”heartless, lacking in sincerity and anti-people” for refusing to cut the taxes on fuel.

Leader of Opposition in the state Assembly V D Satheesan also criticized the Left government and said that the cut in excise duty was ”marginal” and that the state and central governments were carrying out ”tax terrorism.” Surendran, speaking at a press conference, said in all NDA-run states there has been a proportionate decrease in taxes, but the Kerala government was ”arrogantly refusing to reduce even a penny” and this stand was ”heartless, lacking sincerity and anti-people”.

He alleged that the hearts of the state Finance Minister and the Chief Minister have turned to stone as they are unaffected by the plight of the common man.

Satheesan, speaking to the media, said that since the reduction in excise duty by the Centre has resulted in a reduction here by around Rs 1.5 in petrol and Rs 2.5 in diesel prices, therefore, it means that when excise duty was increased, there was a corresponding increase in the state’s revenues.

He said that Congress and UDF only want that out of the additional revenue that the state earned due to the earlier increase in excise duty, a portion is used to provide subsidy to state transport corporation KSRTC, auto, and taxi drivers as well as fishermen.

Satheesan said their demand was a simple one and it has no intention of wanting to dry up the state government’s coffers.

Kerala Pradesh Congress Committee (KPCC) president and MP K Sudhakaran said if there is no corresponding cut in taxes by the state, the protests would not stop and would now be directed against the Left government.

He said that the rise in fuel prices has led to an increase in the cost of essential commodities and day-to-day necessities which was adversely affecting the general public, particularly those of the economically weaker section of the society. Balagopal had on Wednesday said that the Centre’s decision to cut excise duty on petrol and diesel by a ”small margin” of Rs 5 and Rs 10 respectively was ”a temporary measure to save face” and ”throw dust in the eyes of the people.” The Minister, in a statement, had said that for any real difference to be made, the Centre should cut the special tax and cess of Rs 30 per liter levied by it on diesel and petrol.

He had also said the states were not receiving a share of the revenue collected via the additional tax which was being levied irrespective of the international price fluctuations of petroleum.