Towards shouting over the higher petrol and diesel prices the central finance minister, Nirmala Sitaraman directed that the center, as well as the state government, need to execute the mechanism to bring out the retail to the reasonable levels.
The 60% of the retail petrol price which currently lies above Rs 100 in some areas of Rajasthan and Madhya Pradesh is an all-time high and is executed because of central and state taxes.
The taxes are furnished of nearly 56% of the high record diesel rates. FM raised the central excise duty up on petrol and diesel on a record from last year so as to bridge the shortage from the international oil prices so as to provide relief to the people.
“This is a very vexatious issue. An issue in which no answer except reducing the price (of fuel) will convince anyone. I know I am treading on an area and whatever I may say, to bring in the reality into picture, will only sound like I am obfuscating.”
“I am avoiding my answer. I am shifting the blame,” she said while in the event organized by Chennai Citizens’ Forum. The taxation has been elaborated by her and how the production is deducted by oil cartel OPEC and its relevance has led in the international oil prices which leads to the high price in the international oil rates and hence hike in the retail price in India.
She thus told that the reply might lie in seeking the petrol and diesel beneath the GST regime
The fixed rate of excise tax during the states levied for distinct rates of Value Added Tax (VAT). beneath GST these two will merge and opt the uniformity resolving the issue of the fuel prices i.e is high in the states with more VAT.
She added that “What I am saying is that this is a vexatious issue and no Minister can ever convince anybody because Indians being Indians and I am one of them, (will not be convinced),”
“It is a matter of fact that both Centre and States will have to talk”
“I can do that (cut taxes) if I have a certain guarantee that my revenue foregone will not be an opportunity for somebody else to get into this space and gain that,”
The FM also said that the ad velorem structure of taxes bring much higher revenues but was not in the suggestion of even doing the excise duty till zero as it is of no use.
“If all of us are talking about consumer prices (on fuel to) come down (and the) tax raised by the Centre, the tax raised by the states are not holier than one another.”
“Technically, the oil prices have been freed and the government has no control over it,”
“So long and short of it is (that) the states and the Centre have to sit together and see whether there is a way in which the retail price of fuel is at a reasonable level,”
The retails rates are decided on a daily basis by the retailers themselves which are mostly as per the international rates and foreign exchange rates.
“Because every government needs more money, needs revenue and at the same time I can see a relief that not one additional paisa is being demanded from the taxpayers (from the budget),”
“But to get it (fuel prices) under GST needs to be a thorough discussion in the GST Council 
GST officials agree on one rate then all over the country it can be one fuel instead of Chennai which is more expensive than Delhi or Delhi is more expensive than Mumbai.
“That anomaly can be addressed if it is under GST. And that can be just one tax which can be shared by both Centre and State,”
The international prices are very concerned for the fuel as all the oil imports mostly 85 percent is from the outside. For 12 days, the petrol prices were very much higher and stood at 97 per liter in Mumbai and Rs 88 for diesel. The pump prices vary from state to state based on the local taxes VAT and delivery.
