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Not possible to bring petrol, diesel in GST regime even for next 8-10 yrs: Sushil Modi

Finance Minister Nirmala Sitharaman had on Tuesday stated in Lok Sabha that she can be “glad” to talk about the suggestion of bringing petrol and diesel underneath the ambit of the Goods and Services Tax on the next assembly of the GST Council.

Bringing petrol and diesel underneath the GST regime isn’t possible for the next 8-10 years as no state is prepared to face the annual income lack of over ₹ 2 lakh crore on this account, BJP member Sushil Kumar Modi stated in Rajya Sabha on Wednesday.

Speaking in assist of the Finance Bill, the previous finance minister of Bihar dared the opposition to elevate the matter in the GST Council, saying no chief minister or finance minister from non-NDA dominated states has opposed any resolution of the GST Council.

The Centre and states collectively acquire over ₹ 5 lakh crore tax on petroleum merchandise, Mr. Modi stated. The assertion assumes significance in view of the outcry over the rise in petrol value for the previous over one yr that touched ₹ 100 per litre in some states and the demand by the Congress and another events that petrol and diesel be introduced underneath the GST regime.

Finance Minister Nirmala Sitharaman had on Tuesday stated in Lok Sabha that she can be “glad” to talk about the suggestion of bringing petrol and diesel underneath the ambit of the Goods and Services Tax on the next assembly of the GST Council.

Sushil Modi stated it’s simple for opposition leaders to make statements exterior, however nobody raises these points throughout the GST Council.

“Repeatedly, the issue of putting petrol and diesel in the GST regime is being raked up. I have been associated with the GST for a long time, I want to know from the House, that if petrol and diesel are put under the GST regime, who will compensate for the loss of revenue of over ₹ 2 lakh crore to states,” he requested.

“I want to tell this House that it is not possible to put petrol and diesel under the GST in the next eight to 10 years, as no state is ready to lose ₹ 2 lakh crore revenue, be it the Congress or any other government,” he stated.

He stated the Centre and states collectively earn over ₹ 5 lakh crore yearly from tax on petroleum merchandise.

“People in the opposition make fun of the GST regime and someone has also said it is ‘Gabbar Singh Tax’. If you have the courage….all states have a presence there … (Congress-ruled) Chhattisgarh or Rajasthan, no chief minister or finance minister has ever opposed the GST structure.

“It is simple to make statements exterior, however you want braveness as displayed by Narendra Modi to implement the GST. Had there been every other prime minister, he wouldn’t have been ready to implement the GST,” Sushil Modi told the House.

He explained that if petroleum products are brought under the GST, 28 % tax would be collected on them as that is the highest slab in the tax regime. “Presently, 60 % tax is being collected on petroleum merchandise. This would end result in a shortfall of ₹ 2 lakh crore to 2.5 lakh crore (to each the Centre and states),” he explained in the House. “If we acquire 28 % tax on petroleum merchandise, then solely ₹ 14 can be collected (per litre) in opposition to ₹ 60 at current,” he pointed out. “If petrol or diesel value is ₹ 100 (per litre) then the tax element is ₹ 60 which incorporates ₹ 35 for Centre and ₹ 25 for respective states. Besides out of the ₹ 35 tax per litre, 42 % goes to states,” Mr. Modi added. He also slammed those casting doubts on the use of revenue generated from diesel and petrol, stressing that the money is used for development activities.

“It is claimed that the tax collected on petrol, diesel goes into the pocket of the federal government. There isn’t any separate pocket of the federal government. From the place will the cash come for offering electrical energy and faucet water to all households. The spending of tax assortment on the welfare of the nation is being challenged,” the BJP chief lamented.

Sushil Modi had been the convener of the GST Council in his capability because the finance minister of Bihar for a very long time.

In the primary discount in charges in over a yr, petrol value on Wednesday was reduce by 18 paise per litre and diesel by 17 paise per litre as worldwide oil costs tumbled to the bottom since early February. Petrol value was reduce to ₹ 90.99 per litre in Delhi from ₹ 91.17 per litre. Diesel now comes for ₹ 81.30 a litre in the nationwide capital, down from ₹ 81.47 beforehand. Rates have been diminished throughout the nation and differ from state-to-state relying on the native incidence of taxation (VAT). The costs had been final diminished on March 16, 2020.

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