Rajasthan leaders seek value-added tax (VAT) cut on fuel
May, 20th 2011
Sensing the growing public resentment against increasing fuel prices, Congress leaders in Rajasthan have joined the demand for reduction in the value-added tax (VAT) levied on petrol and diesel by the state government.
The Centre hiked petrol price on May 14 for the eighth time since June last year. Increased by Rs 5 per litre, it was the steepest rise in petrol price that has upset people's household budget, which had already been hit by increased food prices and loan interest rates. The Bharatiya Janata Party (BJP) rally against the price hike in the city on Tuesday drew large crowds, as VAT rates on fuel in the state were among the highest in the country.
Initially, Congress legislators Raghu Sharma and Pratap Singh Khachariawas favoured a cut in the VAT rates on fuel. Now the party's state vice-president and former energy minister Chandrabhan has expressed concern over the price hike.
"People are justified in demanding low VAT rates on fuel because we promised to bring down the rates in our party manifesto at the time of assembly elections," Chandrabhan said on Wednesday.
The party vice-president suggested that the Centre should step in to ensure a uniform VAT rate on fuel in all the states. "The Centre can call a conference of all the chief ministers to decide on a uniform VAT rate on petrol and diesel," he said, while advocating a price cut.
The Congress leader, considered close to chief minister Ashok Gehlot, said the party will ask the state government to reduce VAT rates on fuel.
Rajasthan levies 28% VAT on petrol and 18% on diesel. After the latest hike, petrol is selling at Rs 67.47 per litre.
At the same time, Chandrabhan hit out at the BJP for accusing the Congress-government on the VAT issue. "The BJP never reduced the VAT on fuel when it was in power. How can they accuse us of having high VAT rates?" he asked.