Rising costs are set to result in a bigger impact as the Government has not only been able to curb food inflation but hit the aam-junta by hiking price of diesel fuel by Rs. 3/-, Kerosene by Rs. 2/- and cooking gas by Rs. 50 per cylinder.. This will have a direct impact on transportation costs resulting in the fruits, vegetables and various other things getting dearer. But what is this all about? Why do the oil companies keep crying all day and night about bein burdened? Well its high time we find out!
First and foremost, every state government levies VAT on fuel, in Delhi its an insane 13.36%, while other states too have taxes which are to the tune of 20%. Now get the calculators and you will soon realize that the state is charging you close to Rs. 5-10/- per liter of diesel. The same story is with petrol. So one way the Government is crying about the subsidy burden, whereas on the other side state governments are filling their pockets with every liter of fuel sold.
This multiple tax structure is only hurting everyone, while the government is certainly laughing away to the bank. To put things in perspective, the 3-oil companies in India are Government owned, so any loss to them or subsidy to them is totally accounted for by the Government. But the Government prefers to put them in losses so the minority shareholders take the pinch. Why can’t we simply cut the taxes rather than subsidize one side and tax the other?