A litre of petrol comes at base price of Rs 37.29 and gets mounted with centre’s tax of Rs 32.9 i.e. a neat 88.2 % add-up. Similarly, diesel, the base price of which quotes at Rs 39.90 comes with an added central tax of Rs. 31.80. And, despite these statistics, the BJP leaders and their followers are busy propagating that the incessantly inflating petrol prices are owing to state government’s raised taxes. Incidentally, that propaganda comes with a blatant lie that 41 percent of central taxes gets remitted to states. Fact is, Kerala gets gets just about 1 paisa from centre's taxes.
State lowered tax
Kerala levies a 30.08 tax on petrol sale price along with an added Rs. 1.20 in cess. In all, the state earns Rs 26 on one litre petrol. Pinarayi government had lowered state tax to 30.8 % from the previous 31.08% foregoing Rs. 509 crores thereby in taxes. And it never raised that tax since. Tax on diesel is 22.76 percent.
The tax splitting game
The centre’s tax of R. 32.90/L comprises Special Additional Excise Duty, CEntreal Cess and Additional Excise Duty. Of this, the Additional Excise Duty is constituted of just Rs 1.40 and 41 percent of that, i.e. 57 paise, is distributed as tax share to all states. And such distribution being based on state population what Kerala receives is just one paisa on a litre.
It all started with Congress
The practice of near-daily hike for fuel prices was first started by 2nd UPA government. BJP government that came to power later accelerated the trend extending it to diesel prices too. In June of 2010, the Manmohan Singh government removed government control on petrol prices. The diesel prices began to be upped continually by 50 paise monthly initially from January 2013.
The centre’s argument held that oil companies were faced with losses and that the government would raise subsidies. The change in policy was announced by the UAPA government on 30th of June 2010, the same day that it hiked price of petrol by Rs 3.50/L and diesel by Rs 2 in a single shot.
Promise of cutting back pricesas per global rates a hoax
The current government claims it will cut back on fuel prices as crude falls in international market. Only the Left parties raised voice against handing over price control to the oil companies and while BJP would some hue and cry as crude prices rise, it never opposed liberalization and privatization ever. When BJP took to power, it removed government control on the diesel prices too and benefited by fall in international crude prices thereafter, the oil companies thrived. Thus, Reliance, Essar, Kevin and Tata Petrodine grew rich and fatty.
LPG Subsidy Evaporates
Removal of LPG subsidy was first set in motion by the Congress. In June of 2013, the government insisted to link Aadhaar to LPG and bank accounts, so the customers bought cylinders at market price and subsidy gets paid into the linked bank account directly. The government then hailed the reform as measure to prevent misuse of subsidized cylinders. That change introduced by UPA government in over 300 districts was later expanded countrywide by the Modi government. It also got people across the country to open bank account to receive the subsidy. Only that, in a cruel joke, it simply stopped paying subsidy altogether.
