The Central government would have easily given relief from high oil prices if it did not have to bear the cost of oil bonds that the previous UPA government had issued to companies, Finance Minister Nirmala Sitharaman told reporters on Monday.
The UPA government led by Manmohan Singh had issued oil bonds—or instruments in lieu of cash subsidy to oil marketing companies—that are up for redemption now.
“If I had not incurred the UPA’s oil bonds worth over Rs 1. 4 lakh crore, I would have given relief from petroleum prices,” Sitharaman said, explaining why she can’t cut excise duty on petrol and diesel for now.
The minister said people are right to be concerned about the rising fuel prices but the exchequer is burdened by interest payments being made for oil bonds floated by the UPA government. She said that the current government has paid over Rs 70,195.72 crore in interest in the last five years on oil bonds itself.
“We’ll still have to pay interest of Rs 37,000 crore by 2026. Despite interest payments, a principal outstand ing of over Rs 1.30 lakh crore is still pending. If I didn’t have the burden of oil bonds, I would have been in a position to reduce excise duty on fuel, “ she said.
Asked what the government is doing to find a solution to the problem of high fuel prices, the Minister said, “unless the Centre and states discuss a way out, there is no solution possible to this.”
Speaking on the retrospective taxation bill passed by parliament in the monsoon session, the Finance Minister said that she has not discussed provisions related to Taxation Laws (Amendment) Bill, 2021 with any of the concerned parties. “We will have to wait for the rules to be framed under the recent taxation amendment bill and rules will be framed soon. I will follow the law passed in the parliament. No discussions with me so far on Cairn on Vodafone. For repayment or settlement of the cases, I will have to follow the law before me,” she said.
Responding to a question on the new income tax portal, the Minister said, “The glitches on the new Income are expected to be fixed entirely in the next two-three weeks.”
“I have been reminding Infosys constantly and Nandan Nilekani is giving me assurances that they will sort it out,” she added.
Talking about the Goods and Service Tax (GST), Finance Minister said revenues are looking buoyant, and if the revenues continue like this then “I would be able to pay compensation as per the agreement (with states).”
“We will have to consult with states in the council to assess the situation on repayment of borrowing beyond five years of compensation which is ending in June 2022,” the minister added.