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Fuel taxes: Centre rakes in Rs 3.72 lakh crore, low basic excise duty limits states’ share.


Taxes collected by the Central government on petrol went up nearly three times from Rs 9.48 per litre in 2014 to Rs 27.90 per litre in 2021; however, the states’ share in these tax collections rose from Rs 0.38 per litre to Rs 0.57 per litre during the same time period. This is based on data presented by Minister of State for Finance Pankaj Chaudhary in reply to a question in Lok Sabha on Monday.

In 2014-15, the states’ share in the net proceeds of shareable Central taxes and duties was at 32 per cent, which now stands at 41 per cent. The Finance Ministry data also showed that the share of cesses and surcharges in gross tax collections went up more than four times over the last decade between 2011-12 and 2020-21. In 2020-21, the Centre collected Rs 4,09,481.16 crore as cesses and surcharges, up from Rs Rs 92,996.51 crore collected in 2011-12. These collections are not shared with states. “Cesses and surcharges are not included in the divisible pool as per Constitutional scheme for devolution of taxes,” Chaudhary said. As per recommendation of the 15th Finance Commission, the Centre shares 41 per cent of the tax receipts with states for award period 2021–26.

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