HYDERABAD: Telangana tops the country in fuel prices, with petrol being sold at Rs 111.67 per litre and diesel at Rs 99.69. The state stands second in domestic LPG cylinder price at Rs 1,105 after Bihar’s Rs 1,151.
With the bypoll to the Munugode constituency coming up, the TRS and the BJP are facing the heat of higher fuel prices, with both making this an ‘election issue’. The TRS, the BJP and the Congress have been holding each other responsible for the higher prices.
An incident BJP state president Bandi Sanjay Kumar faced during a ‘chai pe charcha’ event in Talla Singaram of Choutuppal mandal in Munugode constituency on Tuesday triggered a fresh tussle between the TRS and the BJP. A group of women reportedly made it clear to Sanjay that they would vote for the party that reduced the prices of cooking gas and essential commodities.
This was welcomed by the TRS leaders while BJP leaders are attempting to counter this stating that the Value Added Tax being imposed by the TRS government on fuel, the highest in the country, is responsible for the price rise. Telangana imposes 35.20 per cent VAT on petrol and 27 per cent on diesel, and the state is estimated to have earned Rs 70,000 crore this way from 2014 to 2021.
While the BJP leaders demand that the TRS government reduce VAT in line with BJP-ruled states, which decreased VAT in November last, the TRS government argues that it had not increased VAT since 2014 and the price rise was on account of taxes and cesses imposed by BJP-led Centre.
At a recent press conference, IT minister K.T. Rama Rao said, “The price increase is because of additional excise duties and cesses imposed by the BJP government. If the BJP leaders are really concerned, they should advise Prime Minister Narendra Modi to scrap cess so that petrol and diesel can be sold at Rs 70 and Rs 60 per litre all over India.”
“(The price of) A barrel of crude oil in 2014 and in April 2022 is almost the same at $ 105. But the price of petrol in 2014 was Rs 70 and now it is at Rs 120. But VAT in Telangana has stayed static since 2014. So where did the increase come from,” Rama Rao had asked.
Crude is currently trading at around $94 but average petrol price on Wednesday was Rs 111.67 a litre. The TRS also holds the BJP responsible for higher LPG prices. It says LPG cylinders come under Centre’s GST regime and states have no powers to impose VAT on LPG.
Although the TRS government might not have increased VAT on fuel since 2014, the fact remains that it is the major beneficiary of price rise. Since VAT is imposed on overall price, the higher the fuel price, the more revenues to the state government.
In the first quarter of this fiscal (April-June 2022-23), the state government earned Rs 4,872 crore through VAT at the rate of Rs 1,624 crore per month. When petrol price was in the range of Rs 70 to Rs 80 per litre, the state government used to earn around Rs 900 crore per month, but with price rise due to Centre’s additional taxes and cesses, the state government is earning over Rs 1,600 crore per month....