VAT an idea! Raj, Kerala act after Centre cuts duty

Rajasthan and Kerala have decreased VAT on petrol and diesel after Finance Minister Nirmala Sitharaman’s call to provide further relief to consumers following a cut in excise duty by the Centre, though some other states appeared reluctant citing their inability to take more strain on revenue.

However, the Left Democratic Front government in Kerala had on Saturday promptly announced a cut in the state tax on the prices of petrol and diesel by Rs2.41 and Rs1.36 per litre respectively, following the reduction in fuel prices by the Centre.

Rajasthan Chief Minister Ashok Gehlot also said the state government will reduce VAT by Rs2.48 per liter on petrol and Rs1.16 per liter on diesel.

In Madhya Pradesh, Congress leader Kamal Nath demanded that the BJP government reduce VAT on petroleum products to further bring down the rates.

Bahujan Samaj Party chief Mayawati said it was the duty of not only Uttar Pradesh but also of other states to immediately announce a cut in VAT on fuel.

In BJP-ruled Karnataka, Chief Minister Basavaraj Bommai said his government will consider a further cut in fuel tax. “The decision (Centre’s) has come on Saturday night, let’s see, we will consider it,” Bommai told reporters in Bengaluru in response to a query. Bommai was last month non-committal on any cut in fuel tax by the state government and had maintained that any decision in this regard will be taken after looking at the economy of the state.

A source in the Goa government said the Pramod Sawant-led dispensation will not further reduce the VAT on petrol and diesel as it “might hurt the economy”.

Goa levies 26 per cent VAT on petrol and 22 per cent on diesel.

The ruling Trinamool Congress in West Bengal said the state will cut taxes once it lifts the “economic blockade” and releases the funds

due to the state.