Fuel price hike in Karnataka: CM Siddaramaiah defends decision; BJP to protest state-wide on 17 June

Vijayendra charged that the “desperate Chief Minister” hiked the petrol and diesel prices since he is unable to start any new programmes due to the five guarantees. “After the Lok Sabha elections, they (Congress government) have increased fuel prices. This will cost all sections of people in the entire state,” the BJP state chief said.

According to officials, the hike is aimed at resource mobilisation. Chief Minister Siddaramaiah, who is also the Finance minister, reviewed the state’s revenue generation and fiscal position and took the decision.

The increase in fuel prices comes days after the Lok Sabha poll results, in which NDA got 19 out of 28 seats in Karnataka, with the BJP winning 17 and JD(S) two. The ruling Congress in the state won nine seats.

Related: Petrol and diesel prices rise by ₹3 in Karnataka after hike in sales tax; BJP breathes fire

What the CM said? 

With the opposition BJP and its ally JD(S) coming down heavily on the Congress government for increasing the petrol and diesel prices by ₹3 and ₹3.5 per litre respectively, Siddaramaiah said even after the hike, taxes on fuel remains low compared to most southern states.

“The Government of Karnataka has increased VAT on petrol to 29.84 percent and on diesel to 18.44 percent. Even after this hike, our state’s taxes on fuel remain lower than most South Indian states and similar economy-sized states like Maharashtra,” the Chief Minister said in a statement.

According to him, the VAT on petrol is 25 percent plus ₹5.12 additional tax, and on diesel in Maharashtra it is 21 percent. Karnataka’s revised rates are still more affordable, he pointed out. “Karnataka’s VAT adjustment ensures we can fund essential public services and development projects. The state remains committed to balanced and responsible governance,” Siddaramaiah emphasised.

Stating that despite the VAT hike, diesel prices in Karnataka are still lower than in Gujarat and Madhya Pradesh, the Chief Minister said, “We remain committed to keeping fuel prices reasonable for our citizens.” He also took a dig at the opposition BJP, which has decided to stage statewide protests on 17 June.

“The then double engine BJP government collaborated to divert Karnataka’s resources to other states. The state BJP govt kept reducing VAT on petrol and diesel while the Central govt increased its own taxes,” the Chief Minister charged. He alleged that this manipulation by the previous BJP government in the state led to reduced revenue for Karnataka, “while the Central government collected more for its coffers, cheating Kannadigas.”

Siddaramaiah said that the Central Excise duty on petrol was ₹9.48 per litre and ₹3.56 on diesel before the BJP came to power in 2014. However, during the tenure of the BJP government, the Central Excise Duty on petrol and diesel was steeply increased, reaching a record high of ₹32.98 and ₹31.83, respectively, in May 2020.

Subsequently, the Excise duty on petrol and diesel was cut by ₹13 a litre and ₹16 litre, respectively, between November 2021 and May 2022, he added. “Despite the reductions, the current Central excise duty on petrol is ₹19.9 and on diesel is ₹15.8. We urge the Union Government to reduce these taxes for the benefit of the people,” the Chief Minister said.

(Edited by Neena with PTI inputs)

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