Petroleum Minister Dharmendra Pradhan urged the Goods and Services Tax Council on Monday to consider bringing petrol and diesel under its ambit, PTI reported. As prices of the two fuels reached multi-year highs, Pradhan said the government was keeping a close eye on the global prices.
On Monday, the price of petrol touched a four-year high of Rs 73.83 a litre in Delhi while the diesel price was at an all-time high of Rs 64.69 a litre. A surge in global crude oil prices, curbs on production by the Organisation of the Petroleum Exporting Countries and high demand are considered the reasons for the increasing fuel prices.
Pradhan said including petroleum products in the GST framework would be in the “interest of energy security and consumers”. Consumers will be able to buy the fuels at “rational prices” across the country if they are charged under GST, he said.
Since petrol and diesel are not under the GST framework yet, producers are not able to set off the tax paid on inputs from the final tax, and this increases the prices.
“When crude oil prices rise, naturally the consumer feels a pinch,” Pradhan said. “We are concerned. We are keeping a close eye on the developing international oil scenario.”
Earlier this year, Finance Minister Arun Jaitley had turned down the oil ministry’s request to reduce excise duty on fuels in the Union Budget in order to soften the blow from rising international oil rates. Besides global factors and the exchange rate of the rupee, the excise duty that the Indian government charges adds to the final amount the consumers pay.
The Congress also made a similar demand, and accused the government of “betraying” the trust of the common man and “miserably failing” to check the rise in fuel prices.
Congress spokesperson Randeep Surjewala said the government was “unmoved” and “unresponsive” to the rising prices. “We have demanded in the past and we again reiterate our demand that petrol and diesel must be brought under the GST,” he said.