People will have to pay more for diesel, aerated drinks and cigarette in Punjab with the SAD-BJP-led State Government raising value added tax (VAT) on these products.
The Punjab Excise and Taxation department, in a notification issued on October 1, has increased VAT rate on diesel (other than premium diesel), cold drinks (including aerated drinks, soda) and Cigarette and Cigar by one per cent, five per cent and 9.5 per cent respectively.
With this hike, the tax on diesel has increased to 9.75 per cent while VAT on cold drinks and cigarette have jumped to 27.5 per cent and 30 per cent. Punjab also levies 10 per cent surcharge on VAT rates. After levying surcharge, the effective tax rates on diesel, beverages, cigarette will be 10.72 per cent, 30.25 per cent and 33 per cent respectively, said an official of Punjab Excise and Taxation department.
After the hike in VAT on diesel, the retail price of diesel has jumped by 55 paise a litre to Rs 58.11 per litre. Punjab annually collects about Rs 2,600 crore of tax from petroleum products.
Meanwhile, Punjab Congress demanded immediate roll back of one per cent hike in value added tax (VAT) on diesel, that was made effective from October 1.
“By effecting hike in VAT, Chief Minister Parkash Singh Badal had given ‘black Diwali gift’ to the people in general, and the industry and farmers in particular,” said Punjab Pradesh Congress Committee (PPCC) president Partap Singh Bajwa.
He pointed that the decision led to increase in diesel prices in the state by 58 paise per litre. “This hike is aimed at adding Rs 110 crore as additional revenue from VAT on diesel,” he pointed.
“VAT on diesel in Punjab is amongst the highest in the states in the country, much higher than even the neighbouring Haryana,” Bajwa said while ridiculing Badal for claiming himself to be the biggest champion of the farmers as it was this section which would suffer the most from this decision in view of the fact that the farm sector in Punjab was known to be the main consumer of diesel.
The state had the highest number of tractors and other farm equipment dependent on diesel, he said.
PPCC chief said that it was Badal who had been attacking the UPA for every hike in the prices of diesel and petroleum on the logic that such decisions were anti-people and add to all round inflation.
“Badal owes an explanation to the people as to why VAT has been increased by one per cent in the state in which it is already being charged at the rate of 8.75 per cent. You can’t have double standards on every issue,” said Bajwa.
Bajwa warned Badal against continuing with the anti-people policies of his government some of which had been opposed even by his alliance partner, the BJP, saying that the people would pay back in the same coin at the appropriate time.