TEAM HERALD
PANJIM: Chief Minister Laxmikant Parsekar on Saturday refused to reduce the value added tax (VAT) on petrol to control its soaring prices, arguing that there is no such demand from public.
“There is no question of reducing VAT on petrol prices. The prices, which are Rs 63-odd per litre is not very high, compared to other parts of the country. Also there is no demand from people to reduce it,” Parsekar told media persons at the sidelines of ongoing information technology (IT) investors meet in Panjim.
“If, now I reduce VAT, petrol will cost less than diesel which is not a good situation,” he added.
Parsekar had said that VAT would be reduced if petrol prices crossed Rs 60 per litre mark. The recent hike last week had raised the petrol prices to Rs 63.50 per litre in the State.
“It was the decision of our government to reduce VAT on petrol, as the price was almost Rs 75 per litre and there was inflation too,” the chief minister said.
Parsekar, defending his government decision to impose VAT on petrol, thereafter said, “The increase in taxations was to compensate the loss resulted due to mining closure.”
“There were media reports speculating about the poor financial situation of the government. The increase on VAT came from that,” he added. “My decision to increase VAT by five percent recently, was highly welcomed by the people…I got so many messages appreciating the decision,” the chief minister commented.
The BJP-led government in an historic decision in 2012, soon after coming to power, had abolished VAT on petrol reducing the prices by Rs 11. However, sudden closure of mining industry with heavy revenue loss forced government, then under Manohar Parrikar, to increase the VAT on petrol from zero to three percent in 2013.
Under the Parsekar regime, VAT was increased twice- December 2014, by five percent and again in March by another five percent. At present 15 percent VAT on petrol is charged.
