Fuel rates linked to global prices; Centre, states must work together: FM

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Union Finance Minister Nirmala Sitharaman said that the price of petroleum goods in the country is determined by international oil rates, according to a report in Business Standard. and that the Centre and states must work together to address the issue of growing costs.

She told a press conference at the BJP’s Kushabhau Thakre Parisar in Chhattisgarh that the prices of petroleum products in India, which is a significant consumer of these imported goods, are determined by global market rates.

As a result, because both the federal government and the states impose taxes on oil goods, Sitharaman believes that both the federal government and the states must work together to address the fuel issue. She was responding to a query on the country’s growing petrol, diesel, and cooking gas prices.

India had to import nearly all of its gasoline and diesel, according to Sitharaman. The Centre does not levy all of the duties and taxes on gasoline and fuel. If we utilise 100 litres (of gasoline or diesel), we must import 99 litres from another country. Prices (of fuel goods) are set here based on international oil pricing.

“When the (global oil) market’s rate changes, it affects us as well.” Instead of levying a value-added tax, the Centre charges a specific amount as a tax (VAT). State governments, on the other hand, levy VAT (on gasoline and diesel), she explained. According to Sitharaman, rising fuel prices have exacerbated the financial hardship on ordinary individuals.

Petrol and diesel are taxed by both the federal government and the states in this system. Prices, I believe, are rising, and the average person is feeling the pinch. However, she noted, both the central government and the states must deal with the problem.

The diesel and petrol prices soared to all-time highs today when rates were raised once more after worldwide oil prices hit their highest level since 2014.