A new report doing the rounds has claimed that the taxes that the centre in levying is the prime reason behind the high fuel prices. The report further says that all the taxes the government is levying, the government is not sharing it with the state governments.
Since the Independence Period, fuel prices have been influenced by two important considerations, namely a rise in fuel prices will slowly bring about an increase in the prices of a lot of goods and and more prices fluctuated, the quicker inflation would rise. The government should work towards insulating the fuel prices from fluctuating due to rising crude prices. The second factor is that the demand is always fluctuating, hence it attracts a lot of indirect taxes.
As there has been a rise in international crude prices the subsidy burden on the oil pool is also increasing and it is a good step to deregulate the oil market from a public policy perspective.
Also, even though the subsidies were rising, the extent at which econtinue reading →