Kerala opposes moves to bring petrol under GST regime, raise coconut oil tax

A worker holds a nozzle to pump petrol into a vehicle at a fuel station in Mumbai, India, May 21, 2018. File Photo: REUTERS/Francis Mascarenhas

Thiruvananthapuram: Kerala on Thursday said it will vehemently oppose any move to bring petrol and diesel under the GST regime as that will further reduce revenue generation for the state and asserted that the Centre should reduce its levies on the two commodities to provide relief to the common people.

Central excise and state VAT (Value Added Tax) make up for almost half of the retail selling price of petrol and diesel. Bringing them under the Goods and Services Tax (GST) would impact revenue generation for the states.

Talking to PTI, Kerala Finance Minister K N Balagopal said the state will strongly oppose if there is any move to bring petrol and diesel under the GST regime.

He said the fuel prices skyrocketed due to the huge increase of its cess by the Centre and if the Union Government reduces the cess, that will help in bringing down the prices of petrol and diesel.

According to him, if petrol and diesel are brought under the GST regime, the state will lose Rs 8,000 crore annually.

In June, the Kerala High Court, based on a writ petition, had asked the GST Council to decide on bringing petrol and diesel within the goods and services tax (GST) ambit.

Five commodities -- crude oil, natural gas, petrol, diesel, and aviation turbine fuel (ATF) -- were kept out of the GST purview when it was introduced on July 1, 2017, considering the revenue dependence of the central and state governments on them.

Recently, the spike in global oil prices on demand-recovery pushed petrol and diesel prices to an all-time high, leading to demand for bringing it under the GST.

Kerala to oppose move to increase tax on coconut oil

Kerala will oppose the move to increase the tax on coconut oil as it will affect the interests of the people of the state, official sources said here on Thursday.

The sources said that there was a move in the GST council to increase the tax of coconut oil from the present 5 per cent to 18 per cent.

According to them, a hike in the tax on coconut oil will pave the way for the rise in prices of coconut oil, which is the major edible oil item in Kerala and parts of Tamil Nadu and Karnataka.

Sources said Kerala will strongly oppose in the GST council its move to increase the tax of the coconut oil as it is against the interest of the people of the state.

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