No Mercy! TS govt in no mood to cut VAT on petrol

Hyderabad: Even as the petrol and diesel prices are likely to touch Rs 100 a litre soon in Telangana, the State Government does not appear to be in a mood to reduce VAT on the grounds that the State was short of funds.

The hike in fuel prices had helped the State to mop up Rs 100 crore additional revenue in the recent months. "This comes as a big relief to the State which was reeling under severe financial crisis post corona lockdown.

The increase in VAT collections would help the State to overcome revenue loss that was seen between March and September this year," a senior official of the state Commercial Taxes department told The Hans India.

The State Government was aware of the spiralling prices of petrol from Rs 87 per litre in December last year to Rs 95 this week. "The state government levies 33 per cent VAT on petrol and 26 per cent on a litre of diesel.

Apart from VAT, the government was also collecting an extra Rs 4 for every litre of petrol and Rs 2 for every litre diesel since the formation of Telangana State in 2014," an official said.

The use of petrol has increased after the lockdown was lifted as people preferred to travel in their own vehicles in the state . Tourists coming from other States also preferred individual vehicles to travel.

The only big revenue generating source on a daily basis is VAT on fuels followed by Excise duty on liquor sales, stamps and registration charges and motor vehicle tax. Hence the government is in no mood to reduce VAT or the special tax that was levied soon after formation of the new state.