PTR rules out reduction in fuel prices for now

Justifying the delay in fulfilling the DMK’s poll promise of reducing petrol/diesel by Rs 5/4 per litre, Thiyagarjan told reporters here, “We promised to reduce VAT on petrol/diesel. It is not possible in the current situation. We will definitely do it. I have come to explain why we cannot do it now.” 

Citing the steep rise in tax on petrol from Rs 10.30 to Rs 32.90 per litre since the BJP assumed office in 2014, he said, “You might wonder why we (state) cannot reduce the tax (on petrol/diesel). Of the Rs 32.90 tax imposed, Rs 31.50 is not being shared with states. The Union govt is taking it fully.” 

Pointing out that Union government’s tax share from petrol/diesel rose from Rs 2.40 lakh crore to Rs 3.90 lakh crore from 2019-20 and 2020-21 fiscals, a 63 per cent rise in their share that reduced state’s share further, Thiyagarajan accused the Centre of reducing state’s share by imposing cess and surcharge. 

“Our fundamental question is how it would be fair to reduce our taxes further. It will create a situation where the state would cut its tax and support the Union increasing its components (taxes) further. It will be unjust on the people of Tamil Nadu,” he said. 

Describing the tax structure as an injustice, Thiyagarjan compared the fuel price in relation to international crude price fluctuation, and said, “We will not get tax share from the Union government and if we continue to reduce taxes, how can we run the state govt.” 

“The union government is running on it. Hence, we are unable to do it (reduce tax on petrol/diesel). But we will fulfill our promise and remove the injustice after the pandemic as early as possible.”