Taxpayers Association urges AP govt to scrap additional VAT on fuel

Vijayawada: The Taxpayers Association has urged the state government to abolish the additional VAT and road development cess imposed on petrol and diesel in the state, stating that the heavy tax burden is resulting in skyrocketing fuel prices and placing an unbearable financial strain on the public.In a memorandum submitted through an email to the chief minister, finance minister on Thursday, the association demanding the immediate intervention to reduce fuel prices stated that several factors have contributed to the continuous rise in petrol and diesel prices, including international crude oil policies, the non-purchase of cheaper crude oil from Russia, the abolition of the Administrative Price Mechanism (APM) by the then NDA government in 2002, and the heavy taxes imposed by both the Central and state governments.Referring specifically to the state-levied taxes, the association pointed out that the government is currently levying 31 per cent VAT on petrol and 22.5 per cent VAT on diesel. In addition, an extra VAT of Rs 4 per litre on petrol and Rs 3.07 per litre on diesel is being collected. A road development cess of Rs. 1 per litre is also imposed, on which VAT is again charged.Through these taxes and cesses, nearly Rs 25,000 crore is reportedly flowing into the state treasury every year, the association said.The association appealed to the state government to provide relief to consumers by reducing at least some of these taxes. It specifically demanded the complete abolition of the additional VAT and road development cess on petrol and diesel, and urged the government to reduce the existing VAT rates to at least 20 per cent.