The state government plans to increase the value-added tax (VAT) on commodities like diesel and petrol, and a proposal will soon be put up before the cabinet for its approval, chief minister Harish Rawat said.

“We are thinking of raising VAT on the pattern of neighbouring Uttar Pradesh,” Rawat told a news conference after chairing a meeting of the Policy Planning Group (PPG) here on Monday.

He clarified that the government would study the impact of raising the VAT before taking a final decision.

He said the assets’ distribution dispute between UP and Uttarakhand hanging fire since 2000 was likely to be resolved soon. “Talks are on between officials from both sides on the long-pending assets' distribution dispute…We are narrowing down the problem and hope to find a solution,” the CM said.

Rawat announced that financial rules and transportation laws would soon be reframed to suit the Goods and Services Tax (GST) regime that the Centre might introduce soon. The laws would be tweaked by a soon-to-be-constituted joint committee to be co-chaired by chief secretary Rakesh Sharma and former chief secretary IK Pande. “We will be benefited by the GST regime only when we change our system accordingly,” the CM said.

He announced that there would be no haphazard increase in service charges. “There will, instead, be a consistent increase in service charges in keeping with a well-defined policy that will be formulated soon,” Rawat said, clarifying that there was a consensus among PPG members of on service charges.