Earlier this month, Prime Minister Narendra Modi said that he can’t tax milk and Mercedes (cars) at the same slab. He probably meant that buyers of Mercedes will have to be taxed more as these cars are bought by the rich whereas milk is more plebian that needs to be made affordable with a lower tax.
Apply that logic to transportation in general: a fuel system that is increasingly used by the masses in public transport, is more efficient and has a better quotient green should most likely be taxed at low er rates compared to those that pollute the atmosphere. The Supreme Court has taken a view that vehicular pollution has to be reduced significantly to make Indian cities more liveable.
So, when the government taxes an efficient and a non-polluting fuel system in the highest GST slab, you begin to wonder what the dynamics are and if the intent of the government is really keen on lowering pollution and making our transportation more productive. Read More