1. Petrol, diesel prices cut by Rs 2, but AAP inserts VAT spanner in Delhi

Petrol, diesel prices cut by Rs 2, but AAP inserts VAT spanner in Delhi

Petrol and diesel prices were today cut by Rs 2 per litre, excluding local levies, in the second reduction of rates this month by oil companies, but petrol will actually become costlier in the national capital due to an increase in VAT rate effected by the AAP govt here.

By: | New Delhi | Updated: July 16, 2015 9:09 AM
Petrol price, diesel price, oil price hike

While the rates will reduce all over the country, petrol price in Delhi will go up by 28 paise a litre. (Reuters)

Petrol and diesel prices were today cut by Rs 2 per litre, excluding local levies, in the second reduction of rates this month by oil companies, but petrol will actually become costlier in the national capital due to an increase in VAT rate effected by the Aam Aadmi Party (AAP) government here.

The decrease in diesel prices would also be less in Delhi due to a hike in Value Added Tax (VAT) by Arvind Kejriwal-led Aam Aadmi Party government.

The new rates announced by the oil marketing companies will be effective from midnight tonight.

While, the reduction in petrol and diesel prices was reflective of local trends, the consumers in Delhi will not be able to get the benefit as the Arvind Kejriwal government raised VAT on the two fuels robbing city customers of the reduction.

While the rates will reduce by a bigger number all over the country, petrol price in Delhi will go up by 28 paise a litre after considering local government’s decision to hike VAT or sales tax on the fuel from 20 to 25 per cent.

Similarly, diesel rates will fall across the country. In case of Delhi, where the VAT on the fuel has been raised from 12.5 per cent to 16.6 per cent, there will be smaller reduction of 50 paise per litre.

Petrol in Delhi will cost Rs 66.90 per litre from tomorrow instead of Rs 66.62 at present. A litre of diesel will cost Rs 49.72 per litre as against Rs 50.22 earlier, Indian Oil Corp (IOC), the nation’s largest oil company, said.

“Prices of petrol and diesel were last revised w.e.f. 1st July’15. Since last price change, there has been a decrease in international prices of both Petrol & Diesel. INR-USD exchange rate has also appreciated during this period. Combined impacts of both these factors warrant the said downward revisions,” it said.

Price of petrol was last cut on July 1 by 31 paise per litre and diesel by 71 paise a litre.

“Since last price change, there has been a decrease in international prices of both petrol and diesel. Indian rupee-US dollar exchange rate has appreciated during this period. Combined impact of both these factors warrants a downward revision in prices, the impact of which is being passed on to the consumers with this price decrease,” IOC said.

The July 1 reduction in petrol prices came on back of three successive increases since May. In case of diesel, the July 1 cut was the second reduction in rates sine June.

Prior to that auto fuel rates were last revised on June 16 when prices of petrol were hiked by 64 paise a litre but diesel rates were cut by Rs 1.35 per litre.

Following are the revised rates of petrol and diesel in four metros after oil firms cut prices, with effect from midnight tonight:

PETROL
Current — Revised — Increase/Decrease
Delhi   — 66.62 — 66.90 — 0.28
Kolkata — 74.09 — 71.57 — -2.52
Mumbai — 74.52 — 71.97 — -2.55
Chennai — 69.84 — 67.29 — -2.55

DIESEL
Current – Revised — Decrease
Delhi — 50.22 — 49.72 — 0.50
Kolkata — 54.75 — 52.75 — 2.00
Mumbai — 57.64 — 55.15 — 2.49
Chennai — 53.52 — 51.08 — 2.44
(All Rates in Rs/litre)

State-owned fuel retailers IOC, Bharat Petroleum Corp (BPCL) and Hindustan Petroleum Corp (HPCL) revise petrol and diesel prices on 1st and 16th of every month based on average imported cost and rupee-dollar exchange rate in the previous fortnight.

“The movement of prices in international oil market and Rupee-USD exchange rate shall continue to be monitored closely and developing trends of the market will be reflected in future price changes,” IOC statement added.

‘Petrol, diesel VAT hiked to fund AAP govt’s publicity drive’

BJP and Congress today slammed the AAP government’s decision to hike VAT rates on petrol and diesel in Delhi as they charged that it was being done to meet its Rs 526-crore publicity budget.

BJP claimed it had foreseen the situation when the ruling AAP had raised the VAT cap by passing an amendment Bill during the Budget Session of Delhi Assembly.

“At the time, Delhi government had said we have no intention to raise prices, but barely 20 days later comes this hike,” said Delhi BJP chief Satish Upadhyay.

It said that the ruling party that has “hundreds of crores” to spend on publicity alone had “no right” to raise the VAT.

Upadhyay said that hike was not needed as the national capital already has “above average VAT collection revenue”.

Delhi Congress chief Ajay Maken’s attack, too, was along similar lines as he claimed in a tweet, “To meet 526cr publicity budget- AAP increases VAT 4% on Diesel and 5% on Petrol- Soon after Budget?”

Leader of Opposition in Delhi Assembly, Vijender Gupta, meanwhile, slammed the hike as allegedly being an example of “cheating and fraud” by the Kejriwal government.

“It’s cheating and fraud as they are putting a burden of around Rs 5,000 crore on people of Delhi annually,” claimed Gupta.

He also welcomed the Centre’s decision, which came after the Delhi government’s hike, to cut petrol and diesel prices by Rs 2 per litre.

Tags: DieselPetrol
  1. T
    t p
    Jul 16, 2015 at 9:15 am
    Hike was not needed as the national capital already has “above average VAT collection revenue".
    Reply

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