In this connection, Modi noted that states like Karnataka and Gujarat undertook tax reduction for the welfare of the people despite revenue loss while their neighbouring states earned revenue by not reducing the tax.
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Prime Minister Narendra Modi today appealed to the states to reduce taxes on petrol and diesel prices like the centre has done in order to provide relief to the common man.
”Some states reduced taxes but some states did not pass on the benefit to the people, leading to higher cost of petrol and diesel in these states. This is not only injustice to the people of the state but practically harms the neighbouring states also,” he said at a meeting with the chief ministers to review the Covid-19 situation in the country.
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In this connection, Modi noted that states like Karnataka and Gujarat undertook tax reduction for the welfare of the people despite revenue loss while their neighbouring states earned revenue by not reducing the tax.
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Similarly, the PM recalled that last November a request was made to reduce VAT but many states like Maharashtra, West Bengal, Telangana, Andhra Pradesh, Tamil Nadu, Kerala and Jharkhand did not do so for some reason.
Noting that 42 per cent of the revenue at the centre was going to the state governments, he said; “I urge all the states to work as a team in this time of global crisis by following the spirit of cooperative federalism.”
He emphasised that in the current global scenario, coordination between the central and state governments in economic matters was necessary for the strength of India’s economy.
In the conditions imposed by global events, this spirit of cooperative federalism became all the more important, he observed in the context of petrol and diesel prices.
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