delhi relief on fuel

7/16/2015

http://epaperbeta.timesofindia.com/Article.aspx?eid=31808&articlexml=VAThikedeniesDelhireliefonfuel16072015003015 1/2

TheTimesofIndiaTitle:VAThikedeniesDelhireliefonfuelAuthor:Location:NewDelhiArticleDate:07/16/2015

StaterunfuelretailersonWednesdayslashedthebasepriceofpetrolanddieselbyRs2alitrebutthebenefitwillnotflowtoconsumersinDelhibecauseoftheArvindKejriwalgovernment'smovetojackupVAT.Whileconsumersinthecountrywilldriveawaywiththebenefit,inDelhitheywillenduppaying28paisealitremoreonpetrolandleftwithareductionofonly50paiseperlitreondiesel.

TheactualreductioninpricesinotherstateswouldbemorethanRs2alitreduetoanincrementaldecreaseinlocalleviesineachstate.TheretailersreducedthepricetopassonthebenefitoffallingglobalcrudepricesinlinewiththeModigovernment'spolicytokeeppacewiththeglobaltrend.

TheAAPgovernmentaftercomingtopowerhasgivenhandoutsintheformofpowerandwatersubsidies.Thisputastrainonstatecoffers.ThehikeinVATissupposedtoshoreupthefinances.

Earlierintheday,theDelhigovernmenthadraisedVATonpetrolfrom20%to25%andondieselfrom12.5%to16.6%.ThehigherVAThadpushedupthepumppriceofpetrolbyRs2.78alitreanddieselbyRs1.83perlitre.

Interestingly,thestatedidn'ttouchCNG.IttriedtojustifythehikecitingauniformVATregimeforpetroratesinnorthIndianstates.TheAAPgovernmenthadclearlyscriptedthehikebeforethebudgetwithabroadconsensusreachedatameetingofthefinanceministersofnorthIndianstatesonMay21.Inthebudgetsession,thegovernmentcreatedthegroundforahikebyamendmentstotheVATActwhichcreatedenablingprovisionsforloweringorhikingVATonvariouscategoriesoftaxableproductsintherangeof12.5%to30%.

WhiletheBJPandCongresshadpointedoutthatthiswasamovetobringaboutahikeinthepricesofpetrolanddiesel,theAAPgovernmenthadstucktoitsstandthatthesewerejustenablingprovisionsaimedatmakingwayforauniformtaxstructure.DeputyCMManishSisodiahadsaidintheDelhiassemblytheaimwastorationalizethetaxregime.Noonewouldhaveguessedthatthehikeinfuelpriceswaslessthanthreeweeksaway.

BJP'sVijenderGuptahitoutatAAPsayingthegovernmentwascheatingthepublicbyimposingthishikeaftertellingpeopleinthebudgetsessionthatVATwasnotbeingincreasedanddescribingitasanaamaadmibudget.Hewarnedthatthiswillleadtoinflation.

DelhiCongresspresidentAjayMakentweeted,Tomeet526crpublicitybudgetAAPincreasesVat4%ondieseland5%onpetrolSoonafterbudget?#FailedGovernance.

7/16/2015

http://epaperbeta.timesofindia.com/Article.aspx?eid=31808&articlexml=VAThikedeniesDelhireliefonfuel16072015003015 2/2