ALL EYES ON PAWAR FOR VAT CUT RELIEF IN 2021-22 BUDGET
Amid rising prices, the pressure is mounting on the Maha Vikas Aghadi government to reduce VAT on petrol and diesel and, thereby, provide a partial relief to vehicle owners. All eyes are now on Deputy Chief Minister Ajit Pawar for an announcement in his budget slated for March 8.
Pawar has said that people will have to wait for the government’s decision till March 8.
In Mumbai, Petrol now costs Rs 97.34 per litre and diesel costs Rs 88.44 per litre. The state government recovers 25% VAT on petrol and 21% VAT on diesel in Maharashtra. In addition, the government also charges an additional cess of Rs 10.20 per litre on petrol and Rs 3 per litre on diesel. In Parbhani, which falls in Marathwada region, recently the petrol prices have touched Rs 100 per litre.
Against this backdrop, the central government expects the state government to cut VAT.
Union Petroleum Minister Dharmendra Pradhan, on Tuesday, questioned why the state government was not taking a proactive role in cutting taxes. Responding to the Congress president Sonia Gandhi’s letter to Prime Minister Narendra Modi over rising fuel prices, Pradhan claimed that the rates were high in the Congressruled Rajasthan and in Maharashtra where Congress is sharing power with Shiv Sena and Nationalist Congress Party (NCP).
“Soniaji must know Rajasthan and Maharashtra have maximum tax. Earnings of central and state governments were negligible during the lockdown. We have allocated large chunks to various sectors in the budget to increase jobs,” said Pradhan.
The Petrol Dealers’ Association president’s advisor Ravi Shinde suggested that the central government needs to reduce excise duty. On its part, the state government should cut the VAT on auto fuel. “Of late, there is an increased tendency of motorists and particularly of two wheelers that, after filling petrol of Rs 400 to Rs 500, they argue that the final gauge does not rise as per their expectations. The poor attendant is targeted for short delivery,” he noted.