The state government is not willing to consider any demand for decrease in the Value Added Tax (VAT) rates on petrol and diesel. State's finance minister Vajubhai Vala refused to assure the House that if there was any further increase in the petrol and diesel prices, the additional income of VAT would be passed on to the consumer as relief.
Replying to Mahudha MLA Natwarsinh Thakore's question, Vala said that petrol and diesel account for about 33 per cent of the total VAT income of the state. In Gujarat the VAT on petrol was 23 per cent, along with another two per cent cess. Similarly on diesel, the tax rate was 21 per cent, apart from three per cent cess.
The minister said that the income from VAT on petrol and diesel was connected with the usage.
In 2009-10, when there was recession in the market, the income had fallen down considerably.
Leader of opposition Shaktisinh Gohil sought to know that when neighbouring states were passing on the increase in the income to the consumers, why was the state government not doing the same. Vala, however, said that this was a suggestion and there was no such consideration.
The state government, in reply to question of Porbandar MLA Arjun Modhwadia, said that because of the rise in the prices of petrol and diesel, the government has got an additional income of Rs 274.08 crore in last one year alone.