New Delhi: P. Chidambaram, Former Finance Minister on Sunday criticized the Union Government for failing to provide more funds to states. Reducing the additional excise duty on fuel, although will be borne by the canter.
Chidambaram pointed out that the reduction is in Additional Excise Duty that has not been shared with the states even though the in the notification on the reduction of duty on petrol and diesel the "FM used the words 'Excise Duty'".
"Hence, contrary to what I said yesterday, the entire burden of the reduction falls on the Centre. To that extent, I stand corrected."
"The states are getting very little by way of share of duties on Petrol and Diesel. Their revenue is from VAT on Petrol and Diesel, I wonder if they can afford to give up that revenue unless the Centre devolved more funds or gave them more grants. The situation is like being between "the devil and the deep sea"," he tweeted.
On Saturday, he said, "Raise Rs 10 per litre in two months and cut Rs 9.50 per litre on petrol and Rs 7 per litre on diesel. This is equal to rob Peter more and pay Peter less!"
Chidambaram has alleged that, "FM's exhortation to States is meaningless. When she cuts Central Excise by one rupee, 41 paise of that rupee belongs to the States."
"It means that Centre has cut 59 paise and the States have cut 41 paise. So, dont point fingers The true cut will be if the Centre cuts from the cess it levies on petrol and diesel (which is not shared with the states)," he had added in his tweet.
With inputs from IANS