'PM Abdicates Responsibility': Rahul, Mamata on Modi's High Fuel Prices Jibe

PM Modi said that some states had refrained from reducing VAT despite the Centre's lowering of excise.

Prime Minister Narendra Modi took a dig at Opposition-ruled states.

(Screengrab: Twitter/Narendra Modi)

A day after Prime Minister Narendra Modi said that Opposition-ruled states had high fuel prices as they had now lowered VAT, various political leaders, including Congress's Rahul Gandhi, condemned the statement.

"High Fuel prices - blame states. Coal shortage - blame states. Oxygen shortage - blame states. 68% of all fuel taxes are taken by the Centre. Yet, the PM abdicates responsibility. Modi’s Federalism is not cooperative. It’s coercive (sic)," Rahul Gandhi wrote on Twitter.

TMC supremo Mamata Banerjee and Maharashtra Chief Minister Uddhav Thackeray are among other leaders who have reacted to PM Modi's jibe against the Opposition-ruled states.

'Centre Owes Maharashtra Rs 26,500 Cr': CM Thackeray Reacts to Fuel Price Dig

Reacting to PM Modi's statements on VAT reduction, Maharashtra Chief Minister Uddhav Thackeray said that the Centre owes Rs 26,500 crore in GST arrears to the state.

"Maharashtra collects the highest GST of 15 percent in the entire country. Maharashtra is number one state in the country in terms of direct taxes and GST combined. Maharashtra is still owed about Rs 26,500 crore due to GST arrears," the chief minister's office said.

"Today, diesel tax share on a litre of diesel in Mumbai is Rs 24.38 for the Centre and Rs 22.37 for the state. Petrol tax share is Rs 31.58 as central tax and Rs 32.55 as state tax. Therefore, it's not a fact that the prices have become more expensive due to state," Thackeray said, as per the CMO.

'One-Sided Talk': WB CM Banerjee

West Bengal Chief Minister Mamata Banerjee said that the interaction with PM Narendra Modi on fuel price hike was one-sided.

"He left the matter of rising prices of petrol, diesel & domestic gas on states, that states will have to slash prices. How will states do it? You increased prices. Did you see your income? You said one-sided things to people. Misleading!" Banerjee said, as per news agency ANI.

Banerjee further said that PM Modi appreciated five BJP-ruled states, who are given more money than her state for several schemes: "You give them 50% more. So, it is not a big deal for them to give up Rs 4,000 crores-5,000 crores, you give them Rs 40,000 crores."

"We have spent Rs 1,500 crore in last 3 years to give subsidy of Re 1 per litre of petrol. You didn't say anything on it. You owe us Rs 97,000 crore. Right now, GoI is taxing 25% more compared to WB government on petrol. We demand Centre to decrease fuel price," CM Banerjee was quoted as saying by multiple agencies.

Banerjee-led Trinamool Congress (TMC) party said that the Centre owes West Bengal Rs 7,807.91 crore, and that the state government has been giving a rebate of Rs1/litre on petrol and diesel since February 2021, in order to reduce the burden on people.

"We say that tax revenue should be 50% each for centre and states. But they did not agree. They collect 75%. How will the states run? I would like to tell the PM to see that instead of giving burden on the states, he should look around," she added.

'Centre Targeting Opposition': Chidambaram, Others Slam PM's VAT Jibe

"On the day the PM exhorted states to cut the VAT rate on petrol and diesel, the Ministry of Finance announced that the Centre owes Rs 78,704 crore to the states! The amount owed is actually more. If you add the amounts that the states claim are owed to them, the total amount may be bigger. Only the Controller of Government Accounts (CGA) can certify the correct amount," former Finance Minister P Chidambaram said in a Twitter thread.

Leader of the Opposition in the Rajya Sabha Mallikarjun Kharge said that PM Modi should first ask BJP governments in Karnataka, Uttarakhand, and Himachal Pradesh to reduce taxes on fuel.

"During UPA, Manmohan Singh gave Rs 1 lakh crore of fuel subsidy every year," Kharge was quoted as saying by ANI.

Congress spokesperson Pawan Khera said that the prime minister should reduce the central excise before asking states to cut VAT.

"He (PM Modi) earned Rs 26 lakh crore out of central excise on petrol and diesel. Has he shared it? You didn't give the GST share to the states on time and then you ask states to further reduce VAT. He should reduce central excise and then ask others to reduce VAT," Khera was quoted as saying by ANI.

Congess leader Deepender S Hooda said that BJP-ruled Haryana has highest VAT on petrol and diesel, adding that the Centre is evading its duty by hiking fuel prices.

"PM Modi is particularly quoting only Opposition-ruled states to reduce taxes on fuel. He won't say that Gujarat or Karnataka should reduce the taxes. The quantum of tax collected by Government of India is 3 times what is collected by these states," DMK MP TKS Elangovan was quoted as saying by ANI.

Jharkhand Health Minister Banna Gupta pointed out that the meeting, which was held to review the COVID-19 situation in the country, had "turned out to be a political meeting."

Meanwhile, Telangana Chief Minister K Chandrasekhar Rao was quoted as saying, "Why can't the Centre cut taxes instead of asking states? The Centre has not only enhanced taxes, it also collects cess. If you have the guts, explain the enhanced taxes."

Telangana Rashtra Samithi (TRS) Working President KT Rama Rao wrote on Twitter, "Fuel prices have shot up because of NPA central government. Name-calling states for not reducing VAT even though we never increased it; is this the co-operative federalism you're talking about. Telangana hasn't increased VAT on fuel since 2014 and rounded off only once."

"Please scrap cess so we can give Petrol at ₹70 & Diesel at ₹60 all over India," he said in another tweet.

Tamil Nadu Minister for Finance and Human Resource Management Dr Palanivel Thiaga Rajan said, "It was estimated that the state government would incur a loss of Rs 1,160 crore annually due to this reduction. Yet this was done, to reduce the burden on the people."

"Government of Tamil Nadu had in fact cut the VAT on petrol back in August 2021, prior to the Union government’s action. That cut resulted in a relief of Rs 3 per litre to the citizens of the state," he was quoted as saying by ANI.

Meanwhile, Kerala Chief Minister Pinarayi Vijayan said that people's suffering due to the rise in fuel prices cannot be mitigated by blaming the states and that the Centre should instead take steps to curb the increase in rates.

(With inputs from PTI and ANI.)