Three months after the MP government slashed VAT on fuel, prices of petrol and diesel are all set to rise again sometime this week as the government has levied 1% cess to generate funds for ‘building infrastructure’. An ordinance to this effect was issued on Tuesday after it got the governor’s nod.
The cash strapped government wants to generate funds to the tune of over Rs 200 crore in the election year, hence it has decided to impose 1% cess on petrol and diesel, government sources said. The cabinet had given its approval on January 3. Talking to the TOI, principal secretary of commercial tax department Manoj Shrivastava said, “The ordinance has been issued and the rules related to the implementation of cess are being translated. This would take atleast two days after which the new tax will come into force.”
Once it is implemented, the 1% cess will push up rates of the petrol by more than Re 78 per litre and diesel by Re 66 per litre. “This calculation is done on the basis of Tuesday’s price of Rs 76.24/litre of petrol and Rs 64.69/litre of diesel”, said Ajay Singh, state president of fuel station association. The actual amount of the 1% cess levied by the government will vary according to the dynamic cost of the fuel. For the past few months, the cost of the both diesel and petrol has been going up by 10 to 15 paisa every month, he said. Read More…
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