Anger after Odisha govt levies 3 % VAT on petrol, diesel


If you are in Odisha and own a vehicle, there’s a bad news for you. The Odisha government has now decided to levy additional 3% Value Added Tax (VAT) on petrol and diesel making the fuel dearer.

The notification issued by the finance department said that the VAT on petrol and diesel would now effectively be 26 per cent from earlier rate of 23 per cent.

Starting today, petrol and diesel across the state will now cost more by Rs 1.39 per litre and Rs 1.14 per litre respectively.

“By increasing VAT by 3 per cent on the fuel, the state government will get additional revenue of Rs 361 crore per annum. It would amount to Rs 90 crore additional revenue in the next three months during the current fiscal,” Finance Minister Pradip Kumar Amat was quoted by PTI.

The decision to hike VAT on diesel and petrol comes after the news that the state’s revenue collection was badly hit due to frequent decline in the prices of petrol and diesel.

“In order to keep a balance in revenue collection of the state, the government raised the rate of VAT on the fuel,” he said.

Amat said the state government had earlier reduced VAT on petrol and diesel from 20 per cent to 18 per cent in June 2014 when fuel prices spiked in the international market.

The finance minister said that the central government, meanwhile, has hiked basic excise duty, additional excise duty, special excise duty and Cess on petrol and diesel by 104.30 per cent and 231.30 per cent respectively.

Both Congress and the BJP have demanded an immediate rollback of the hike in VAT on fuel prices.

OPCC President Prasad Harichandan said, “The increase in VAT on the fuel will adversely affect the general public. It will encourage price rise of many essential items. We demand a rollback.”

BJP leader Basant Kumar Panda also demanded a rollback on the fuel price hike. He said that his party condemned ‘such action of the state government.’

According to earlier reports, the state government had lost Rs 417 crore annually because of low oil prices.


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