Diesel price may go up as UT issues draft notification

In December, administration had reduced VAT from 12.5% to 9.68 % to bring diesel prices at par.

Chandigarh | Published: May 10, 2015 3:17 am
diesel price, draft notification, VAT, diesel price hike,  Chandigarh Petroleum dealers association, chandigarh news, city news, local news, chandigarh newsline, Indian Express ‘This move will again take away the level playing field from us.’

By: Vivek Gupta

The price of diesel in Chandigarh is set to go up substantially as the UT Administration has issued draft notification to increase the value added tax (VAT) on diesel from 9.68 per cent to 12.225 per cent. A final notification is expected soon.

In December last, UT Administration had reduced VAT from 12.5% to the existing 9.68 % to bring the diesel prices at par with Tricity. The move, once notified, will increase the diesel prices by Rs 1.25 every 1.50 litre, thereby again making it most expensive in Tricity. At present, diesel in Chandigarh is being sold at Rs 49.19 per litre which is almost at par in comparison to Panchkula (Rs 49.32) and Mohali (Rs 49.46).

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While opposing the move, Amandeep Singh, general secretary of the Chandigarh Petroleum dealers association, said, “Earlier, city’s high-volume consumers, including truck and bus operators, preferred filling up their tanks from neighbouring state. But the business had come back to local leaders ever since diesel rates came down in Chandigarh in December last.

“This move will again take away the level playing field from us. We have been told that the rate is being increased to bring the VAT at par with Punjab. However, the administration is forgetting that Chandigarh dealers also pay 2 per cent Central Sales Tax above VAT since there is no oil depot here. Therefore VAT in any case should be on lower side in Chandigarh for the overall public interest, he said.

City-based advocate Ajay Jagga, who opposed the move in his letter to the administration said that tax is defined by the Ministry of Law and Justice as a compulsory contribution to the support of the government’s social expenses. “As far as I know, there is no shortage of funds or financial crunch in the administration despite having a budget available, circumstances for enhancement of tax must be conveyed to the people, in the larger public interest, he said.

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