Finance Minister Nirmala Sitharaman has said the excise tax cut on fuel prices is being borne by Center
A day after the government announced tax cuts on gasoline and diesel prices, Finance Minister Nirmala Sitharaman said on Sunday the cut has been fully implemented in road and infrastructure tax (RIC), which is not shared with states.
In other words, the Minister of Finance made it clear that the burden of the excise reduction is fully borne by the Center.
She said that even in November 2021, the excise tax cut of Rs 5 per liter for petrol and Rs 10 per liter for diesel was done entirely in RIC.
“Basic excise tax (BED), special supplemental excise tax (SAED), RIC and agriculture & infrastructure development cess (AIDC) together constitute excise duties on petrol and diesel,” she said in a tweet.
“The basic excise tax is shareable with states, while SAED, RIC and AIDC cannot be shared,” the Treasury Secretary tweeted.
Ms Sitharaman’s tweets refuted opposition criticism of the government’s decision.
Earlier, former union finance minister P Chidambaram and then other opposition leaders had stated that the cut in excise taxes announced Saturday night would reduce states’ share of central taxes.
Later, Mr Chidambaram withdrew his statement on Sunday, saying that the cut in tariffs will only benefit the central government.
Meanwhile, the Treasury Secretary went on to say that the NDA government had spent much more than the previous Congress-led UPA regime on development work.
Data from the Reserve Bank of India (RBI) shows that the total development expenditure of the government led by Prime Minister Narendra Modi in 2014-22 was Rs 90.9 lakh crore. In contrast, in 2004-2014, only Rs 49.2 lakh crore was spent on development spending,” Ms Sitharaman said in another tweet.
She further said that “our government expenditure under Mr Narendra Modi includes Rs 24.85 lakh crore spent so far on food, fuel and fertilizer subsidies and Rs 26.3 lakh crore on capital creation. During the 10 years of UPA, only Rs 13.9 lakh crore was spent on grants”.
1/ Good to see the interest generated by @PMOIndia@narendramodi Yesterday’s decision to introduce a tax cut on petrol and diesel.
Share some useful facts.
“I’m sure criticism/review can benefit from having them for us.
— Nirmala Sitharaman (@nsitharaman) May 22, 2022
The government had cut excise duty on petrol by Rs 8 per liter and Rs 6 per liter on diesel on 21 May in a bid to curb rising inflation.
