VAT on diesel increased by Rs 3/litre in Himachal, cheaper compared to Punjab, Haryana, Uttarakhand: CM Sukhu

In a bid to enhance revenue, the Himachal Pradesh government on Saturday increased the value-added tax (VAT) on diesel by Rs 3 per litre to Rs 10.40 per litre. VAT on diesel has been increased from 9.90 per cent to 13.9 per cent, an increase of Rs 3 per litre from Rs 7.40 to Rs 10.40 per litre, as per the notification issued by the State Excise and Taxation department.

Justifying the increase, chief minister Sukhvinder Singh Sukhu on Saturday said the previous BJP government had reduced the VAT by seven per cent on the eve of the last assembly polls held in November 2022 and the increase was imperative for mobilising resources along with other measures.

He said the state has suffered huge losses due to heavy rains and resources have to be mobilized in this hour. The roads, water supply schemes and electricity have been restored temporarily and it would take almost a year to restore the damaged infrastructure.

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In spite of an increase in VAT, diesel is cheaper in the state as compared to the neighbouring states of Uttarakhand, Punjab and Haryana, he asserted.

Reacting sharply to the decision of the government to increase VAT on diesel, former chief minister and leader of the opposition, Jai Ram Thakur said the increase in rate of diesel at a time when people are reeling under the impact of unprecedented rains and flood and longing for relief is uncalled for.

The hike is illogical and would put a huge burden on the people. Moreover, the increase in prices of diesel has a cascading effect on the transport sector and leads to inflation.

The state government has increased the rates of diesel by Rs 3 per litre, immediately after coming to power and the second increase in six months is painful, he added.