The Meghalaya government is yet to take a call on cutting value-added taxes (VAT) on fuel, at par with other BJP-ruled states in the region, as it was battling financial crisis at the moment, Chief Minister Conrad K Sangma said Monday.
The Centre, last week, slashed petrol and diesel prices by Rs 2.50 per litre, following which 12 BJP-governed states, including Assam and Tripura, announced matching cuts.
Talking to PTI, Sangma said, "It is a tough call and we are taking a bit of time to ensure that we make the right decision after taking into consideration all aspects. The state is facing huge financial crisis at present."
The CM, however, expressed hope that a decision was likely to be taken at the next cabinet meeting as "people have been suffering due to the rise in prices".
"A decision on fuel price cut might be taken at the cabinet meeting, which will be held in a day or two. We need to balance it out" he said on the sidelines of a programme at Don Bosco Museum here.
The CM also said that senior officials have warned him against the consequences of cutting VAT on fuel prices.
Slashing VAT by Rs 2.50 per litre could have an adverse effect on a small state like ours, a senior government officer said on the condition of anonymity.
"The monthly revenue loss that the state's exchequer will have to bear due to VAT reduction will be more or less sufficient to run at least one district for that same period," he said.
The state had faced a huge setback in 2014 when coal mining and transportation from Meghalaya was banned by National Green Tribunal owing to various reasons, including unscientific extraction methods and illegal practices.
"Roughly the state experiences a loss of about 400-600 crores annually due to the ban," the officer added.
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)