News Analysis India

Tag: vat

  • 6 non-BJP ruled states have not reduced VAT on petroleum products: Govt

    By PTI

    NEW DELHI: Six non-BJP ruled states — West Bengal, Tamil Nadu, Andhra Pradesh, Telengana, Kerala and Jharkhand — have not reduced the VAT on petroleum products, leading to higher prices of petrol and diesel there, Petroleum Minister Hardeep Singh Puri said on Thursday.

    Puri said in Lok Sabha that the central government has reduced excise duty on petroleum products and some other states, following cues, and reduced their Value Added Tax (VAT).

    Six states — West Bengal, Tamil Nadu, Andhra Pradesh, Telengana, Kerala and Jharkhand — have not reduced the VAT, he said, amidst vocal protests by the opposition members.

    The minister said, currently the petrol price in India is one of the lowest.

    He said the oil marketing companies together suffered losses of Rs 27,276 crore due to high prices of crude in international markets. “I suggest MPs from the opposition impress upon their state governments to reduce the VAT so that they can also join the celebrations,” he said.

    Puri said India imports more than 85 per cent of its crude oil requirements.

    Therefore, the prices of petrol and diesel in the country are linked to their respective prices in the international market.

    He said the retail prices of petrol and diesel depending on various factors like crude oil purchase price, exchange rate, shipping charges, inland freight, refinery margin, dealer commission, central taxes, state VAT and other cost elements.

    While the average price of the Indian basket of Crude oil increased by 102 per cent (from USD 43.34 to USD 87.55) between November 2020 and November 2022, the retail prices of Petrol and Diesel have increased in India by only 18.95 per cent and 26.5 per cent during this period respectively.

    The minister said prices of petrol and diesel have not been increased by public sector Oil Marketing Companies (OMCs) since April 6, 2022, despite record-high international prices.

    “As a result, against the combined ‘Profit Before Tax’ of Rs 28,360 Crore in H1 of the financial year 2021-22, the three OMCs IOCL, BPCL and HPCL have booked a combined loss of Rs 27,276 Crore in H1 of the current financial year 2022-23,” he said.

    Puri said to insulate Indian consumers from the impact of high international crude oil prices, the central government reduced the central excise duty twice on November 21, 2021, and May 22, 2022, effecting a cumulative reduction of Rs 13 and Rs 16 per litre for petrol and diesel respectively, which was fully passed on to the consumers.

    Following these reductions in central excise duty, some of the States and UTs also reduced Value Added Tax (VAT) rates on petrol and diesel.

    The minister said India imports more than 60 per cent of its domestic LPG consumption.

    The price of LPG in the country is based on the Saudi Contract Price (SPC), the benchmark for the international price of LPG.

    Saudi CP rose from 236 USD /MT in April 2020 to 952 USD /MT in April 2022 and continues to prevail at elevated levels currently.

    However, he said, the government continues to modulate the effective price to consumers for domestic LPG.

    Public Sector Oil Marketing Companies have suffered huge losses on the sale of domestic LPG and to compensate for these losses, the government has recently approved a one-time compensation of Rs 22000 crore to OMCs.

    Unsatisfied with the minister’s reply, members belonging to Congress, DMK, TMC and NCP staged a walkout of the house.

    NEW DELHI: Six non-BJP ruled states — West Bengal, Tamil Nadu, Andhra Pradesh, Telengana, Kerala and Jharkhand — have not reduced the VAT on petroleum products, leading to higher prices of petrol and diesel there, Petroleum Minister Hardeep Singh Puri said on Thursday.

    Puri said in Lok Sabha that the central government has reduced excise duty on petroleum products and some other states, following cues, and reduced their Value Added Tax (VAT).

    Six states — West Bengal, Tamil Nadu, Andhra Pradesh, Telengana, Kerala and Jharkhand — have not reduced the VAT, he said, amidst vocal protests by the opposition members.

    The minister said, currently the petrol price in India is one of the lowest.

    He said the oil marketing companies together suffered losses of Rs 27,276 crore due to high prices of crude in international markets. “I suggest MPs from the opposition impress upon their state governments to reduce the VAT so that they can also join the celebrations,” he said.

    Puri said India imports more than 85 per cent of its crude oil requirements.

    Therefore, the prices of petrol and diesel in the country are linked to their respective prices in the international market.

    He said the retail prices of petrol and diesel depending on various factors like crude oil purchase price, exchange rate, shipping charges, inland freight, refinery margin, dealer commission, central taxes, state VAT and other cost elements.

    While the average price of the Indian basket of Crude oil increased by 102 per cent (from USD 43.34 to USD 87.55) between November 2020 and November 2022, the retail prices of Petrol and Diesel have increased in India by only 18.95 per cent and 26.5 per cent during this period respectively.

    The minister said prices of petrol and diesel have not been increased by public sector Oil Marketing Companies (OMCs) since April 6, 2022, despite record-high international prices.

    “As a result, against the combined ‘Profit Before Tax’ of Rs 28,360 Crore in H1 of the financial year 2021-22, the three OMCs IOCL, BPCL and HPCL have booked a combined loss of Rs 27,276 Crore in H1 of the current financial year 2022-23,” he said.

    Puri said to insulate Indian consumers from the impact of high international crude oil prices, the central government reduced the central excise duty twice on November 21, 2021, and May 22, 2022, effecting a cumulative reduction of Rs 13 and Rs 16 per litre for petrol and diesel respectively, which was fully passed on to the consumers.

    Following these reductions in central excise duty, some of the States and UTs also reduced Value Added Tax (VAT) rates on petrol and diesel.

    The minister said India imports more than 60 per cent of its domestic LPG consumption.

    The price of LPG in the country is based on the Saudi Contract Price (SPC), the benchmark for the international price of LPG.

    Saudi CP rose from 236 USD /MT in April 2020 to 952 USD /MT in April 2022 and continues to prevail at elevated levels currently.

    However, he said, the government continues to modulate the effective price to consumers for domestic LPG.

    Public Sector Oil Marketing Companies have suffered huge losses on the sale of domestic LPG and to compensate for these losses, the government has recently approved a one-time compensation of Rs 22000 crore to OMCs.

    Unsatisfied with the minister’s reply, members belonging to Congress, DMK, TMC and NCP staged a walkout of the house.

  • UP govt reduces VAT on fuel to further bring down diesel, petrol prices in state

    By Express News Service

    LUCKNOW: The UP government has reduced the state VAT imposed on diesel and petrol by Rs 1.03 and 1.40 per litre respectively, after the Centre slashed the excise duty on the fuel three days ago.

    This will bring down the effective prices by Rs 8 on diesel and approximately Rs 10  on petrol. UP CM Yogi Adityanath shared the information on the floor of the Assembly while responding to a query on Wednesday.

    The UP CM’s submission came when SP MLA Virendra Yadav sought to know if the state government would take any step to reduce the state tax on fuels to bring down their prices in the wake of the rising inflation.

    Yogi said that the base price of petrol and diesel automatically got reduced on May 22 when the Centre reduced the excise duty on diesel and petrol by Rs 8 and Rs 6 per litre respectively. The CM added that the LPG was covered under GST for which any approval to reduce tax would have to be granted by the GST council.

  • Chhattisgarh government announces reduction of VAT on petrol, diesel

    By PTI

    RAIPUR: The Chhattisgarh government on Monday decided to reduce Value Added Tax (VAT) on petrol and diesel by 1 per cent and 2 per cent, respectively.

    This decision was taken during the cabinet meeting chaired by Chief Minister Bhupesh Baghel, a government official said.

    The move will cause a loss of nearly Rs 1,000 crore to the state exchequer.

    “Providing major relief to the people of the state. Chief Minister Bhupesh Baghel-led cabinet has decided to cut the prices of petrol and diesel. VAT on diesel and petrol has been reduced by 2 per cent and 1 per cent respectively. The state government will bear the loss of about Rs 1,000 crore,” the Chief Minister’s Office (CMO) tweeted.

  • Punjab BJP hits out at Channi government for not reducing VAT on petrol, diesel

    By PTI

    CHANDIGARH: Punjab BJP chief Ashwani Sharma on Saturday slammed the Charanjit Singh Channi-led government in the state for not reducing Value Added Tax (VAT) on petrol and diesel to provide relief to consumers.

    He said that the Centre had provided relief to people by reducing excise duty on petrol and diesel before Diwali.

    Sharma said the BJP-ruled states also slashed VAT on fuel that led to a reduction in retail prices of petrol and diesel.

    But the Congress-led government in Punjab has not reduced tax on fuel, he stated.

    He accused the Channi-led government of trying to befool people but not giving any relief to them.

    “Why the Punjab government is not giving relief to people by reducing VAT on fuel,” Sharma asked in a statement.

    He stated that after the reduction in excise duty and VAT in Chandigarh, the rate of petrol and diesel stood at Rs 94.23 and Rs 80.90 a litre.

    But as against this, the rates of petrol and diesel were Rs 106.20 and 89.83 per litre.

    He demanded from the Punjab government to bring the fuel rates on par with that of Chandigarh.

    Punjab BJP general secretary Subhash Sharma wrote a letter to Punjab Chief Minister Charanjit Singh Channi, demanding a reduction in taxes on petrol and diesel.

  • Madhya Pradesh govt announces VAT, cess cut for petrol, diesel 

    By PTI

    BHOPAL: A day after the Union government slashed excise duty on petrol and diesel, Madhya Pradesh Chief Minister Shivraj Singh Chouhan on Thursday announced a four per cent cut in the Value Added Tax (VAT) and Rs 1.50 cut in the cess on the two fuels.

    As a result, the price of petrol will come down to Rs 106.86 and that of diesel to Rs 90.95 per litre in the state capital Bhopal from Friday.

    In a bid to give relief to the people despite financial constraints, the state government has decided to cut VAT on petrol and diesel by four per cent, an official release said.

    Besides, chief minister Chouhan also decided to slash by Rs 2 and Rs 1.50 the cess on petrol and diesel, respectively, it added.

    The prices of the two fuels, thus, will be reduced by Rs 7 per litre, it added.

    The relief would leave a hole of Rs 1,948 crore in the state government’s coffers during the remaining months of this fiscal, the release said.

    The prices of petrol and diesel dropped by Rs 6.27 and Rs 12.49 per litre, respectively, in Bhopal on Thursday morning following the Centre’s decision to cut excise duty, Bhopal Petrol Pump Dealers Association secretary Nakul Sharma had told PTI earlier in the day.

    The prices of petrol and diesel fell to Rs 112.54 and Rs 95.39 per litre, he had said.

    Opposition Congress had asked the BJP government to take a cue from other states and reduce the VAT on petrol and diesel.

    Congress Rajya Sabha member Digvijaya Singh posted a tweet with the hashtag “Modi hai to mahangai hai”, saying, “Thank you Modi-ji for Rs 5 reduction on petrol after raising the central excise tax by nearly Rs 35 per litre on petrol and diesel. Keep raising it from tomorrow.”

    Madhya Pradesh Congress spokesman Bhupendra Gupta had said the state government should also reduce VAT on the fuels as the BJP-ruled states of Uttar Pradesh, Goa, Karnataka, Uttarakhand and Tripura have done.

    Even the BJP’s ally JD(U) in Bihar had reduced the VAT on fuels, he had pointed out.

  • Bihar slashes VAT rates on fuel after centre’s announcement

    By PTI

    PATNA: The Nitish Kumar government in Bihar on Thursday reduced its VAT rate on petrol and diesel by more than Rs 3 per litre, a day after the Centre slashed excise duty on the products in a bid to provide relief to consumers.

    An announcement to this effect was made by the Chief Minister on his Twitter handle.

    “Following the Centre’s move to reduce petrol and diesel prices, the state government has decided to provide additional relief to people by reducing the VAT rates. The prices of petrol will be lowered further by Rs 3.20 per litre while for diesel it will be Rs 3.90 per litre,” Kumar tweeted.

    The Centre had, on Wednesday, made petrol and diesel cheaper by Rs 5 and Rs 10 per litre respectively, a move which has evoked similar response by many states, mostly the ones ruled by the BJP-led NDA.

  • Uttarakhand government mulls reducing VAT on fuel prices soon

    Express News Service
    DEHRADUN: The Uttarakhand government is mulling to cut the price of petrol and diesel by Rs 2 and Re 1 respectively.  Officials from the state government told The New Indian Express that the prices will be cut by reducing value added tax (VAT) adding that the reduction to be announced soon. 

    “The government is planning this. An announcement may come soon. This is keeping in with next year’s election. There are talks of Uttar Pradesh thinking of doing the same,” said a highly placed official in the state government. 

    Uttarakhand government at present imposes Rs 19 per litre VAT on petrol and Rs 10 per litre of the same on diesel. Petrol in Dehradun costs Rs 97.81 per litre while diesel costs Rs 90.54.

    In many towns of Uttarakhand, prices of petrol are more than the capital city. In Johsimath of Chamoli district, petrol costs Rs 100.38 while in Srinagar ‘Xtra Power’ petrol costs Rs 102.13, in Gopeshwar price sir petrol have reached Rs 99.90. 

    In last 6-and-a-half months, prices of petrol have been increased by Rs 14 and diesel by Rs 16. Increase in petroleum products in the state and countrywide has been a issue which opposition parties jave been raising prominently. 

  • Petrol pumps closed in Rajasthan as dealers demand rollback of VAT on fuel

    By PTI
    JAIPUR: People faced difficulty across the state due to a one-day strike called by Rajasthan Petroleum Dealers Association of fuel stations on Saturday with the demand of a rollback in VAT on fuel in the state. Around 7,000 petrol pumps remained closed in the state due to the strike.

    However, fuel pumps that are company owned and company operated were open for the public. Association president Suneet Bagai said diesel and petrol sales remained closed on the day. “The state government increased VAT during the coronavirus pandemic and generated extra revenue. The sales volume in the state has declined by 34 per cent because the fuel prices are comparatively low in neighbouring states,” he said.

    The association has already submitted a memorandum of demands and we would go on an indefinite strike from April 25 if there is no positive decision by the government, Bagai said.

  • Petrol is cheaper by Rs 12, diesel by Rs 4 in Chhattisgarh, thanks to lower VAT

    Amid the rising fuel prices across the country, Chhattisgarh has it under control as petrol is cheaper by Rs 12 and diesel by Rs 4 in the state than in other states.

    Chief Minister Bhupesh Baghel says that the reason is his government’s decision to have a VAT rate lower than the neighbouring states. At present, the VAT rate for transport fuels in Chhattisgarh is 25% plus Rs 2 per litre on petrol and 25% plus Re 1 per litre on diesel.

    In the Raipur district, petrol is sold at Rs 87.28 per litre and diesel at Rs 85.66 per litre. 

    Compared to this, the petrol price in the Gondia district of Maharashtra is Rs 96.07 per litre and diesel Rs 86.31 per litre. Likewise in the Balaghat district of Madhya Pradesh, petrol is being sold at Rs 99.07 per litre and diesel Rs 89.55/litre. In the Sonbhadra district of Uttar Pradesh, the petrol price is Rs 87.76 per litre and diesel Rs 84.24 per litre. 

    In Simdega of Jharkhand, the petrol price is Rs 87.81 per litre and diesel price Rs 85.19 per litre. In Bargarh of Odisha, the petrol price is Rs 90.64 per litre and diesel price Rs 87.34 per litre. 

    The base price of petrol is Rs 19.48 per litre, on which the Central government imposes central excise of Rs 31.98, whereas the Chhattisgarh government imposes VAT of Rs 15.11.

    Similarly, the base price of diesel of Rs 28.66, on which the Centre imposes central excise of Rs 31.83, whereas Chhattisgarh imposes only Rs 16.12 as VAT.