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  • Category: Miscellaneous

    Is the price rise of fuel amounts to tax extortion ?

    Congress leader Rahul Gandhi has criticised the central govt that it is not able to contain the prices of fuel and thereby resorting to tax extortion. It is to be mentioned here that the central government has no place in deciding the fuel prices as they are done by the four oil companies based on the international behavior of crude oil prices. No doubt in the recent past the fuel prices have increased enormously and everyone is cursing the situation but the government has no place to decide the pricing. Do you feel Rahul Gandhi made the right comment? What is your reaction?
  • #736199
    In India cost of the fuel is having three portions. One is the actual price of the fuel. The second is the tax part that is imposed by the Central government and the third is the tax part imposed by the State governments. There is no doubt that the prices of the oils are controlled by the four companies across the globe. But the problem comes with the taxes. Whenever there is a price rise automatically the taxes will also increase as the taxes are charged as a percentage of the original price. When the prices are going up the governments can think of bringing down the taxes so that a common man may not suffer much. But that is not happening at present. The governments may not reduce the taxes as they also want money for running the show.
    It is common in our country for the opposition parties to criticise the government when there is a price rise. Nothing wrong with the remarks of the Congress leader. When Vajpayee was the opposition leader he came to the Parliament on a bullock cart to protest against the fuel prices.

    always confident

  • #736203
    Is he ready to cut the state tax in Punjab to give relief to the people ?
    K Mohan @ Moga
    'Idhuvum Kadandhu Pogum "
    Even this challenging situation would ease

  • #736205
    That is in no way related to this question. Let the BJP leaders in Punjab question the Chief Minister there. I feel nothing is going to happen unless otherwise, the government think of reducing the taxes. Tomorrow if Congress comes to power. BJP will also criticise that government like this only. It is all in the game. Finally we the taxpayers are the suffers.
    No person is going to reduce the usage of their private vehicles. Only when people stop purchasing the fuel and use public transport for commuting, then only there may be some thinking about these taxes by the governments.
    The diesel cost in AP is Rs.3/- more than that of the same in Telangana. Can the State government think of reducing their share of taxes?

    always confident

  • #736212
    RaGa will never speak on the Bond scheme implemented by the Congress led UPA government from Oil Exporting Countries to not to pass the immediate hike to the end users but instead to be pass on to the successive governments. In here it is the Modi led NDA government which is still paying a huge amount on basic as well as on interest for the burrowings which took place during the Congress regime.

    I would request the members to do some research onto this and share the fact.

  • #736226
    Yes, don't you think so? Shall Rahul Gandhi or any other political leader has to remind the countrymen about the tax structure on fuel? Let me tell you the reality. In Kolkata, the price of 1 litre of Petrol is Rs 99.84. Here the centre gets a tax of Rs 32.90 and the state gets a tax of Rs 19.27. The total tax for petrol becomes Rs 52.17. Rather than making it a BJP versus Congress game why the centre is not reducing the taxes out of its own? Don't think that the government has no say in the prices of the fuel because every government has a say on everything that is happening in the country, be it the fuel price rise or tussle with social media platforms. India is not a developed country but a developing country and everyone in the country doesn't have the same economic power to purchase things. Think of the people of the country and not politics or political leaders.

    "Life is easier when you enjoy what you do"

  • #736231
    It is human nature that no one will volunteer to give anything not to speak of taxes. So a compulsion or pressure is put by way of legislation etc. In the case of direct taxes people can ( many do) avoid or pay less than needed. Even when penal provisions are there still there is tax avoidance and any number of litigations are happening and pending.
    However in the cases of indirect taxes the ultimate consumer cannot avoid as it is loaded in the price paid. So the governments always increase indirect taxes as the overall amount is large and revenue collected will also be large in spite of default by anyone in the production and supply chain before the end buyer.
    The implementation of GST by merging a number of individual direct taxes has somewhat streamlined and simplified the indirect taxes. The tax quantum itself came down and became uniform with only fewer categories.

    Most of the State Governments did not agree to bring liquor and Fuel prices under GST because they wanted the freedom to tax these two cash cows. Hence a of now liquor and Fuel bear the burden of Taxes by central government and taxes by state government. Moreover after the price decontrol , refineries have the freedom to price them . So ultimately fuel, being an imported product, the final user consumer has to pay high due to the progressive price rise and double taxation.

    If fuel is brought under GST there can be relief. As the taxes are ad valorem, any increase in base price proportionately increases tax on that. so the final price has a cascaded effect. In addition to that both governments can increase tax rate also. So there is definitely a need to bring fuel also under GST. Til then it will be a shadow play by centre and state fooling the people.

    Taking these facts we may say it is tax extortion now.

  • #736246
    Fuel price hike always becomes a burning issue because it is directly related to people. It is not the matter what Rahul Gandhi said about central government or what he commented against P.M. rather it is a matter of why fuel price is increasing after a few days or months.
    If the taxes are reduced proportionately to the price hike, it will solve this problem.

  • #736256
    My say is,

    "Stop unwanted freebies meant for the needy individuals."

    Due to continuing policies of subsidies or providing on FOC basis to those who no more required this are creating unnecessary financial burden on policy formulation of the government.

    I pity on few who keep on finding the means to target the government and believe that rest are not understanding it.

  • #736328
    # 736212
    @Ved Prakash Anand: You have written about bond scheme and I hope that you must have full knowledge about the purpose of the bond scheme also.
    According to BBC Atal Bihari Vajpai led NDA also adopted this bond scheme. It is true that UPA government issued bonds to oil companies between 2005 to 2010 and the present government has to pay total Rs 1.31 Lac crores by 2026. The government has already paid Rs 35 hundred crores so far whereas it has earned Rs 22 Lac crores so far through taxes between 2014-2021. Speaking in parliament state minister finance said that during 2020-2021 government earned (through taxes) Rs 2.94 Lac crore in 10 months during corona time when consumption of oil was also reduced.
    If our government restarts bonds scheme in place of present Dynamic fuel price system where oil price fluctuates every day will stop price hike. Moreover, oil price will also come down to an affordable point for a common commuter.
    I think the government will ponder over this issue also.

  • #736340
    I think the current elected Modi led NDA government has got a well thought out priorities before them and they do not have suspicion or doubts when we think of implementing those. They are not ruling on the soft decisions like wasting time and energy on fixing peace talks with the neighboring countries or conducting cricket matches for pacify the relations which often got hyper due to terrorist attacks.

    Few who still got problem with price hike of fuels, I want to remind them of the fact that once in February of 2014, the then Defense Minister A. K. Antony from the Gandhi's Congress led UPA government admitted that,

    "Government has no money to go ahead with the procurement of 126 fighter jets"

    The above is one of its type and we must understand the kind of government that this used to be.

    The present government has shown their intentions with implementing GST, carrying out demonetization, removing Article 370 and Ram temple to name a few. And this government is again working on defense and developmental projects including CAA, NPR and NRC which would be needing a huge money and wherein the tax paying numbers are quite less in comparison to the numbers enjoying huge subsidies and many more on FOC basis, this lets the government to depend on the fewer sources.

    What would you feel if you are told that even after >70 years of time we have not been able to connect with the Imphal (Manipur), Aizawl (Mizoram) and Kohima (Nagaland) but the good thing is that this may happen by March 2023.

    The government is also busy fencing the Eastern border with Pakistan to completely stop intruders. These all projects need huge investment, but I do not know whether we know about these or do not know about these but in case we know about these then why not discussing?

    I have no doubt that we are surrounded by paid media and few who are always wanting their propagandas to be fulfilled.

  • #736428
    Are we done here members?

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