Petrol Price: TN govt slashes tax by Rs 3

Tamil Nadu government announced that it had decided to bring down the cost of Petrol by Rs 3 through reduction of its taxation. The announcement to this effect was made by Finance Minister PTR Palanivel Thiagarajan in the Legislative Assembly while presenting the revised Budget Estimates for the current fiscal.

Chennai: Tamil Nadu government, on Friday, announced that it had decided to bring down the cost of Petrol by Rs 3 through reduction of its taxation. The announcement to this effect was made by Finance Minister PTR Palanivel Thiagarajan in the Legislative Assembly while presenting the revised Budget Estimates for the current fiscal.

"State has 2.63 crore two-wheelers, highly utilised by the working class and they are worst affected by the rise in petrol price. While the union had failed devolve funds raised through tax revenue generated from petrol, it is solely responsible for the petrol price", the Minister observed.

"Chief Minister MK Stalin, who understands the pain - the petrol price rise causes to the poor and the middle class had directed the tax rate be reduced by Rs 3. This will be a major relief and it will cost the exchequer Rs 1,160 crore per annum", he added.

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Delving deep into Union-State fiscal relations, Thiagarajan said, "Nowhere is this dilution of the spirit of federalism more apparent than in the taxation of petrol and diesel at the pump. The overall Union levies on petrol were increased from Rs.10.39 per litre in May 2014 to Rs.32.90 per litre today.

Comptroller and Auditor General of India (CAG) has pointed out that the Union Government cesses levied for a specific purpose have not been fully utilised for the intended purpose, and surcharges which are meant for a limited time have continued almost indefinitely. This Government will establish an advisory council to develop a Federal Fiscal Model with renowned experts on legislation involving revenue and taxation (including GST)."

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