Kerala Minister Thomas Isaac said the state would not reduce tax on fuel after Centre's announcement.
Kerala Finance Minister Thomas Isaac on Thursday refused to cut Value Added Tax (VAT) by Rs 2.50 on petrol and diesel, after the Centre's announcement. He added that there would be tax cuts in Kerala, only if fuel prices are brought down to the level when the Narendra Modi government assumed office in May 2014.
"Ever since the Modi government assumed office, it has raised excise duty on diesel by Rs 14 and petrol by Rs 9 per litre. You should understand that the reduction effected on Thursday is on this amount. If the Centre is serious, it should reduce the tax to what it was when it assumed office. Then we will also step in," Mr Issac said.
In a relief to consumers, the Centre on Thursday cut petrol and diesel prices by Rs 2.50 per litre and also asked the states to effect similar cuts. Mr Jaitley told the media in Delhi that the price cut will be effected through reduced excise duty of Rs 1.50 per litre, while oil marketing companies will absorb a cut of Re 1 per litre.
He appealed to the states to reduce VAT by Rs 2.50 to take the total cut to Rs 5 per litre for the common man.