Fuel Prices Come Down: How will fuel prices come down in the country? What did Nirmala Sitharaman say?

Fuel Prices Come Down : Will the fuel prices in the country come down soon? Recently Union Finance Minister Nirmala Sitharaman also mentioned the same issue. Nirmala Sitharaman told NDTV that if the state governments agree to this proposal and decide on an appropriate rate, petrol and diesel can be taxed under GST (Goods and Services Tax) rather than VAT (Value Added Tax).

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“If the states decide the rate of fuel prices and all come together… if petroleum products are decided to be included in GST… the center can implement it immediately,” she said. If that happens, we may see a drop in fuel prices.

If it comes under GST.. same tax:

Because.. these are taxed only once unlike other levies. That is.. not only on the price of the product but also on center excise. Currently, petrol and diesel prices vary from state to state. Because.. each has its own tax. Central excise duty is levied on it.

Ultimately consumers have to pay tax twice. Once the tax has to be paid to the state government and once to the central government. Bringing both of these under the ambit of GST will ensure a uniform tax across the country. In theory, it could lower fuel prices.

The final decision on fuel prices rests with the states:

According to Prime Minister Narendra Modi.. about 60 percent tax on petroleum products. State Rs. 2.5 lakh crore, the Center Rs. 2 lakh crore earned. By bringing petrol and diesel under GST, the maximum tax slab on these products will be 28 percent. Because.. the highest slab in the present tax system. The Center has made it clear that it is ready for this move by November 2022. But, it left it to the states to take the final decision on fuel prices.

Union Minister Hardeep Puri, who was then Minister of Petroleum, said that if the states come together, we are ready.. Everything is ready. However, not all states agree with this idea. Because.. due to this the respective states have to lose significant revenue. In fact, the GST Council did not recommend bringing petroleum products under one umbrella in December 2021.

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