Kerala Finance Minister Balagopal once again refuses to reduce sales tax on fuel. Oppn boycotts Assembly

Finance Minister Balagopal once again refuses to reduce sales tax on fuel. Oppn boycotts Assembly in protest
Kerala Finance Minister K N Balagopal and Opposition Leader V D Satheesan

The Opposition UDF boycotted the last day of the current Kerala Assembly session on Thursday in protest against what Leader of Opposition V D Satheesan termed "the government's refusal to reduce the sales tax on fuel like other states in the country and help the public."

Finance Minister K N Balagopal, responding to an adjournment motion on fuel prices moved by Congress MLA K Babu, reiterated what he had been repeatedly saying: "Even when we could have decided otherwise, Kerala government has reduced the price of diesel by Rs 2.30 and petrol by Rs 1.57." He was referring to the automatic reduction in the sales tax component when the Centre reduced prices.

He also said that, unlike the Centre that had constantly upped excise duties and other states that had imposed special COVID cess, Kerala had not even once hiked the sales tax rate or imposed new cess in the last six years.

"In fact, in 2018, we had reduced the tax rate and brought it down to 30.80% (petrol) and 22.7% (diesel) from the UDF rates of 31.80% and 24.75%," Balagopal said. He said this reduction had inflicted a cumulative loss of Rs 1,500 crore on Kerala.

The finance minister's other big argument was that the Centre was robbing states of its rightful due. "There was a time when excise duty on petrol was Rs 10. Since 41% of the excise duty collected should be shared with states, the Centre has now reduced it to Rs 1.40 a litre. This way they have to pay states just 60 paise, " Balagopal said.

But at the same time, he said the Centre had considerably increased impositions on a litre of fuel that need not be passed on to states like the special and additional excise duties and cesses. This way the Centre got fattened and the states got impoverished.

Balagopal also sought to turn the tables on the UDF saying that the Oommen Chandy government had increased sales tax 13 times during its five years. Opposition Leader V D Satheesan countered this by quoting figures of additional income netted by the UDF and LDF governments.

"The additional revenue the Oommen Chandy government had collected as a consequence of fuel price rise was Rs 493 crore. During the last five years of the Pinarayi Vijayan ministry, the additional revenue was 10 times more, nearly Rs 5,000 crore, Rs 2,190 crore from sales tax and Rs 2,673 crore as petrol cess for KIIFB, " Satheesan said.

Kerala Assembly
UDF legislators cycling to the Kerala Assembly on Thursday in protest against the rising fuel prices. Photo: Manoj Chemancheri

He also said that the amount collected as tax under the two governments differed. If Rs 13.76 was collected as sales tax for a litre of petrol under the UDF government, it is now Rs 26.11 a litre. For diesel it was Rs 9.16 a litre under the UDF and Rs 20.31 now," the he said.

Satheesan then caught the finance minister off guard. Usually, opposition leaders make their walk out speeches and leave. Satheesan, instead of declaring a walk out, asked Balagopal a direct question: "Are you willing to forego a part of the additional Rs 5,000 crore you have collected so that the people reeling under the worst economic crisis could get some relief. I want to know whether you would do this or not."

Hurling this politically loaded poser, Satheesan sat in his place. Balagopal repeated his argument but not before looking helpless and bewildered for a moment.

The Opposition members then rushed towards the Speaker's dais and raised slogans. Five minutes later, Satheesan pulled the sloganeers back and declared that the UDF was boycotting Assembly proceedings in protest.

Earlier in the day, the UDF legislators took out a bicycle rally to the Kerala Assembly in protest against the rising fuel prices. V D Satheesan led the protest cycle rally of his legislator colleagues from the nearby MLA Hostel attached to the assembly complex.

Wearing masks and donning the usual khadi dhoti and shirt, they could be seen pedalling the 'poor man's vehicle' through the busy city road to reach the main entrance of the Assembly.

After trooping out of the House, they also staged a protest sit-in at its portals and raised slogans against the state government for rejecting their demand for discussing the topic during the zero hour. The Congress-UDF has been staging protests across the state for the last several days demanding the slashing of state tax on petrol and diesel.

The comments posted here/below/in the given space are not on behalf of Onmanorama. The person posting the comment will be in sole ownership of its responsibility. According to the central government's IT rules, obscene or offensive statement made against a person, religion, community or nation is a punishable offense, and legal action would be taken against people who indulge in such activities.