Hyderabad: Amid a heated debate on fuel taxation, the state govt on Monday sharpened its attack on the Centre, flagging what it called a widening gap between the state’s tax contributions and the funds it receives in return.Speaking during the discussion on the Telangana Value Added Tax (TVAT) Mobility Amendment Bill-2026, excise minister Jupally Krishna Rao said the state has been contributing far more to the Union exchequer than it gets back. He pointed out that between 2018-19 and 2024-25, Telangana contributed ₹4.60 lakh crore in taxes and GST to the Centre, but received only ₹1.36 lakh crore as devolution and grants. He said the amendment is expected to generate an additional ₹47 crore in a single financial year, underlining its importance in improving the state’s fiscal position while ensuring better compliance in fuel sales. The minister criticised the BJP-led central govt for what he described as ‘discriminatory treatment’ of states. He alleged that BJP-ruled states were being favoured, while others, including Telangana, were being treated in a ‘stepmotherly’ manner. His remarks came in response to BJP members demanding a reduction in VAT on petrol and diesel. BJP MLA Payal Shankar argued that fuel taxes should be lowered, especially for agricultural use, as farming now depends heavily on tractors. Bihar gets a lot in returnCountering the demand, Jupally cited comparative figures, stating that while Bihar contributed ₹93,560 crore in taxes to the Centre during the same period, it received ₹6,25,450 crore in return. “When funds are tight, these figures should be kept in mind by BJP members,” he said. Defending the amendment bill, the minister said it was aimed at plugging loopholes in fuel taxation and strengthening state revenues. He explained that the govt had identified a major fuel company exploiting a system where tax was imposed only at the first point of sale through internal transactions, leading to revenue leakage. To address this, the govt issued orders in June 2025, which the current amendment seeks to formalise. Jupally said the move has already begun to yield results. VAT collections, which averaged ₹28 crore earlier, rose to around ₹30 crore after the notification, with total collections increasing from ₹220 crore to ₹250 crore during the period from July 2025 to Feb 2026.
