Reduction in VAT leads to Rs 10,500 crore drop in fuel revenue: Guj Govt

Gandhinagar: Gujarat’s government revealed in the ongoing budget session of the state assembly that reducing the value-added tax (VAT) on petrol and diesel in October 2021 resulted in a reduction of Rs 9,500 crore in revenue over the past two years. This reduction in VAT also led to a loss of Rs 1,000 crore in revenue from compressed natural gas (CNG) and piped natural gas (PNG).

In response to queries from Maninagar MLA Amul Bhatt, finance minister Kanu Desai said, “the government collected Rs 38,730 crore in VAT and cess on petrol, diesel, CNG, and PNG.” In addition, Desai said the state earned Rs 11,870 crore in VAT and cess on petrol, Rs 26,383 crore on diesel, Rs 128 crore on PNG, and Rs 376 crore on CNG.

Desai further revealed that the state government imposes 13.7% VAT and 4% cess on petrol, 14.9% VAT and 4% cess on diesel, 15% VAT on commercial PNG, 5% VAT on household PNG, 15% VAT on CNG for wholesalers, and 5% VAT on CNG for retailers. DeshGujarat