After reducing the basic excise duty on petrol and diesel by Rs 2 a litre, the Centre has requested state governments to lower tax on petrol and diesel in a similar manner, so that the common man is benefitted.
At present, prices of petrol and diesel are completely decontrolled. The oil marketing companies fix the prices on a daily basis. Petrol and diesel constitute a major part of the revenue earnings of state governments.
Each state government levies tax on petrol and diesel according to its requirements. That is why the states did not agree to bring petrol and diesel under the purview of GST.
One must understand that asking states to lower tax on petrol and diesel is not a permanent solution. The step that needs to be taken is: petroleum products should be brought under GST, so that prices of petroleum products remain the same across all states.
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