Chief Minister Sukhvinder Singh Sukhu led Himachal Pradesh government on Saturday announced an increase in the Value added tax (VAT) on diesel. The state government has increased VAT on diesel by Rs 3 per litre to Rs 10.40 per litre.
After the announcement, VAT on diesel has been increased to 13.9 percent from previously 9.90 percent, 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. The move has come after the hill state has been battling widespread damages brought due to torrential rainfalls, which resulted in deaths due to landslides among other calamities.
CM Sukhu while justifying the increase said that the state has suffered huge losses due to the rains and resources have to be mobilized in this hour. The roads, water supply schemes and electricity have been temporarily restored and it would take almost a year to completely restore the damaged infrastructure.
CM Sukhu further said that the previous BJP government reduced the VAT by seven percent on the eve of last assembly elections held in November 2022 and the increase was imperative for mobilizing resources among other measures.
Despite of increase in VAT, Diesel in Himachal Pradesh is still cheaper when compared to its neighboring states Punjab, Haryana and Uttarakhand, he further said.
While reacting to the increase in VAT, former CM of Himachal Pradesh and BJP leader Jai Ram Thakur said the increase in the rates of diesel at a time when people are suffering the wrath of unprecedented rains and floods and longing for relief is uncalled for.
He further termed the decision has “illogical” and would put burden on people. He also said that the increase will put an adverse impact on the transport sector and lead to inflation. The hike in rate has come for the second time since Sukhu led government took charge six months ago.