Opinion | High petrol prices can fund public transport

Opinion | High petrol prices can fund public transport

News:

1.Central Government should utilize tax revenue to enhance public transport system.

Important News:

2.Hike in fuel prices has started a debate on how the Tax revenue from petrol and diesel can provide efficient public transport system in urban area.

3.Central Government levied a road cess on every litre of petrol and diesel towards the Central Road Fund which was created in 2000.

4.Until 2018, the Fund used to finance the projects for road construction, National Highway Development Projects, Rural roads etc.

5.However, in 2018, Union Budget has announced increase in cess from Rs.1 to Rs.8 per litre. Subsequently, the Fuel cess and Road Fund was renamed as the Infrastructure Cess and Central Road and Infrastructure Fund.

6.Infrastructure fund was created with aim of providing efficient public transport.

7.But in 2017, Delhi government proposed a fare hike of 100 % for Metro to increase the Profitability.

8.Fare hike discouraged the use of public transport and criticized the Government that purpose of public transport is not to generate revenue but provide transport to masses at the least cost.

9.What Government should do to deal with the situation:

• Reduce taxes on fuel, making private transport cheaper.
• Reduce fares, making public transport cheaper.

10.In the context of Delhi, it can easily afford to reduce the Metro fare as loss incurred can be compensated with revenue from petrol sales.

11.Revenue surplus from diesel can be used to make investment in Public transport as well as in pedestrian infrastructure.

12.To provide sustainable and clean transport system, Government should begin treating the Infrastructure Cess as a carbon tax in Urban areas.