New Delhi: Senior Congress leader P Chidambaram hit out at the Centre after it announced that it was reducing the excise duty on petrol and diesel prices, and wondered if states could afford to give up revenue from VAT on petrol and diesel unless the “Centre devolves more funds or gives them more grants.” I wonder if they can afford to give up that revenue unless the Centre devolved more funds or gave them more grants.
The situation is like being between “the devil and the deep sea”, “Hence, contrary to what I said yesterday, the entire burden of the reduction falls on the Centre.
To that extent, I stand corrected The states are getting very little by way of share of duties on Petrol and Diesel. Their revenue is from VAT on Petrol and Diesel”. “The notification on reduction of duty on Petrol and Diesel is now available. FM used the words ‘Excise Duty’, but the reduction is in Additional Excise Duty which is not shared with the states. Hence, contrary to what I said yesterday, the entire burden of the reduction falls on the Centre. To that extent, I stand corrected,” he tweeted.
Union Finance Minister Nirmala Sitharaman yesterday said the fresh cut in excise duty on fuel has a revenue implication of Rs 1 lakh crore a year and urged state governments to follow suit.
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