Indore : After .5% inxrease in service tax by the Centre, now it’s turn of the State Government to follow the suit. Through a gazette notification, the State Government has made amendments in the VAT Act. With this changes, Petrol and Diesel prices would be costlier by Re 1 per liter soon.
Through a gazette notification, the State Government has made further amendments in the MP VAT Act 2002. The State Government has issued MP VAT (second amendment) Act 2015 on November 2. Through the amendments the Government has got the power to impose additional tax on volume of a liquid material. Now, the government has got the power to impose the tax on measurement or per liter.
Talking to this correspondent, RS Goyal, Commercial Tax consultant, said that in the gazette the State Government has not mentioned the name of the commodity. Through a separate notification, the name of commodity would be disclosed soon. He expressed concern that the price of petrol and diesel could be dearer by Re 1 per liter.
Goyal said at present the VAT on petrol and diesel is at 12% on the value of the fuel. For example if the base price of the fuel is Rs 50 per liter, so after the VAT it will be Rs 62 per liter. Now, the tax would be imposed on volume or quantity of the fuel. For example if a person takes 1 liter petrol or diesel, then the price of the fuel would be raised by Re 1 per liter.
When asked the need for making amendment in the VAT Act, he said that the State Government was forced to raise the additional fund as the centre denied to provide any help to the state to help out its drought-affected farmers. Hence, to raise the fund, the state was imposing extra tax on petrol and diesel. However, making of the diesel dearer by Re 1 per liter could create a wave of price hike, because this would directly affect the transportation of the commodities.
