Petrol, diesel to cost more in Rajasthan with hike in VAT rates

Petrol and diesel will be costlier in Rajasthan from Friday as the state government has increased the value added tax (VAT) on the two fuels in its third hike in the COVID-19-induced lockdown.

The state government on Thursday increased the VAT on petrol to 38 per cent from 36 per cent earlier while on diesel to 28 per cent from 27 per cent earlier.

Before lockdown, the VAT rate on petrol was 30 per cent and on diesel was 22 per cent.

In the last week of March, the state government increased VAT by 4 percentage points on petrol and diesel and then in April-mid, it increased the rate by 2 percentage points on petrol and 1 percentage point on diesel.

Rajasthan Petroleum Dealers Association President Suneet Bagai said that state government has revised the VAT rate third time in the last three months. The increased rate will burden the dealers as well as consumers.

"Cash strapped government has again increased VAT rate on fuel. It will burden dealers as well as consumers. Petrol and diesel pumps located in the border areas of neighbouring districts are on the verge of shutdown due to increased VAT. Demand is continuously decreasing," said Bagai.

He said prices of petrol and diesel in the state are higher than that in neighbouring states.

He said that revenue loss is due decreasing sales and it is not wise to put burden on common people, adding that the government should rather focus on generating non-tax revenue.