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Step-motherly treatment: Opposition-ruled states respond after PM Modi flags high fuel prices

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New Delhi, Apr 27: Flagging higher fuel prices in many opposition-ruled states, Prime Minister Narendra Modi on Wednesday called it "injustice" to people living there and urged the governments there to reduce VAT in "national interest" to benefit the common man.

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PM Modi raised the issue of many states not adhering to the Centre's call for reducing the Value Added Tax (VAT) on petrol and diesel after his government slashed excise duties on them in November last, and asked them to work in the spirit of cooperative federalism in this time of global crisis.

In his remarks, Modi cited the example of Karnataka and Gujarat, both ruled by the BJP, saying they have suffered revenue loss of nearly Rs 5,000 crore and Rs 3,500-4,000 crore respectively by reducing VAT but they did so to help people. Their neighbouring states did not reduce the VAT, he added.

States like Maharashtra, West Bengal, Telangana, Andhra Pradesh, Tamil Nadu, Kerala- all ruled by different opposition parties- have not reduced VAT for some reasons, and prices there are higher than other states, he said.

"I am not criticising anyone but am praying to you for the welfare of people of your states...I urge you to reduce VAT now even after a delay of six months to benefit people," he said, with chief ministers of most of these states listening. In Chennai, Jaipur, Hyderabad, Kolkata and Mumbai, petrol prices (per litre) are over Rs 111, Rs 118, Rs 119, Rs 115 and Rs 120, he said, noting that they cost much lower at Rs 102 in the union territory of Daman and Diu, Rs 105 in Lucknow, Rs 106 in Jammu, Rs 105 in Guwahati and Rs 103 in Dehradun.

Here is how different state governments have responded:

KT Rama Rao took to Twitter to allege that fuel prices had shot up because of the central government.

He wrote, "Name-calling states for not reducing VAT even though we never increased it - is this the co-operative federalism you're talking about Narendra Modi ji? Telangana hasn't increased VAT on fuel since 2014 and rounded off only once."

"We don't get 41 per cent of our rightful share because of the cess imposed by your government. In the form of cess, you are looting 11.4 per cent from the state and we are getting only 29.6 per cent for FY23. Please scrap cess so we can give petrol at Rs 70 and diesel at Rs 60 all over India. One Nation - One Price?"," he wrote.

West Bengal

West Bengal CM Mamata Banerjee has said that PM Modi's appeal to Opposition states to reduce fuel tax has a 'political agenda'.

"I ask you, Modi ji, not to talk about these things in a Covid meeting. He [Modi] is telling us to decrease the tax and he will loot the tax. The PM should not speak like this, he cannot burden states like this. He said states should reduce tax but he hiked the price! This is a one-sided remark which is totally misleading," she said.


Maharashtra Chief Minister Uddhav Thackeray said that the state government cannot be held responsible for the spike in fuel prices.

He said, "Today, in the price of one litre of diesel in Mumbai, Rs 24.38 is for the Centre and Rs 22.37 is for the state. In petrol price, 31.58 paise is central tax and 32.55 paise state tax. Therefore, it is not a fact that petrol and diesel have become more expensive due to the state."

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