Escalating Fuel Prices

We have seen successive hikes in petrol and diesel prices for four consecutive days. This is at a time when crude oil prices are so low in the international market. The benefit of reduced crude price is adjusted  as excise duty and other taxes, on account of which consumers are not getting even a small share of that reduction. There is no doubt that facing the economic challenges posed by the Covid pestilence has necessitated increased revenue for the government.  But it is surprising that certain other crucial areas are left out.

The government owes huge amounts of tax arrears (on account of various taxes) from institutions in various sectors as well as individuals.The defaulted payment of taxes also includes taxes already collected but not duly remitted. At this point when the government is struggling for augmenting revenue, there must be concerted efforts to recover the defaulted tax amounts. Unfortunately that does not appear to be happening.

Coming to oil companies, it is high time that these entities which have been making huge profits year after year, started showing a slightly more humane approach in the matter of fuel prices.  A look at the Annual Reports of India's four largest public sector oil companies (including the oil giant IOC) shows that the overhead expenses of all these companies are exorbitantly high by any standards. The staff expenses hover around 35-40% for these corporates. Three of them have about 55 Executive Directors and about 150 General Managers. Same is the case with lower level senior executives as well. Apart from getting a high fortune as compensation,  their personnel have attractive pension benefits also. Everything is fine. But why should they go on burdening the common man through successive fuel price hikes, that too in a situation when a majority of people are passing through a phase of financial struggle?