Revenue important, can't put fuel under GST: Gujarat government
The BJP government in Gujarat today made it clear that it will not bring petrol and diesel under the ambit of Goods and Services Tax (GST) as doing so would make a significant dent in the state revenue. Speaking during a discussion of budgetary demands, state Finance Minister Nitin Patel also indicated that VAT on fuel is not likely to be reduced. Here more.
Gujarat will lose half of its tax collection: Patel
Replying to Congress legislators' demand that fuel items be brought under GST, the minister said, Gujarat will lose half of its tax collection to the Centre if petrol and diesel were brought under the GST. The 50-50 revenue sharing formula of GST is like running a loss-making business, he said, adding that's why all states have decided not to put fuel items under GST.
Center can reduce the central excise on fuel
"The best way (to give relief to people) is that the Center reduces the central excise on fuel. We can think of adopting the GST for fuel only if the Council charts out a formula to make sure that the states do not suffer a loss," Patel said. Otherwise there is no point in doing a loss-making business, he added.
Gujarat levies 20% VAT and 4% cess on fuels
Gujarat levies 20% VAT and 4% cess on both petrol and diesel. The Minister indicated fuel under GST-ambit cannot be expected. "The tax on petrol and diesel in Gujarat is much lower than in many other states. It is perhaps the lowest in the country," Patel said. Another Congress MLA CJ Chavda had claimed that the total farm debt in Gujarat is Rs. 32,000cr.
Farmers in Gujarat take loans of Rs. 20,000cr every year
"Farmers in Gujarat take loans of Rs. 20,000cr every year. Around 95% of them repay the loans in time. It shows that farmers are not reeling under debt. Instead of just waiving loans, our government is trying to increase their income," Patel said. Patel said per capita income in Gujarat is Rs. 1.56L, while the total debt of the state stands at Rs. 1,99,338cr.
