Cabinet to Increase VAT on Petroleum

Fuel prices in Punjab are set to rise following a decision by the state Cabinet to increase the value-added tax (VAT) on petrol and diesel. The VAT on petrol will increase by 61 paise per litre, while diesel will see a rise of 92 paise per litre. This decision was made during a meeting chaired by Punjab Chief Minister Bhagwant Mann.

Currently, the retail price of petrol in Mohali is Rs 97.01 per litre, and diesel is Rs 87.21 per litre. These prices are already higher than in Chandigarh, where petrol costs Rs 94.24 and diesel is Rs 82.40 per litre.

Fuel pump owners have strongly disapproved of the decision, arguing that it will adversely affect their businesses. They pointed out this is the third fuel price hike under the Bhagwant Mann-led government in the past two-and-a-half years.

Finance Minister Harpal Singh Cheema explained that the VAT increase is expected to generate an additional Rs 395 crore in revenue from diesel and Rs 150 crore from petrol. However, Petrol Pump Dealers' Association spokesperson Monty Sehgal criticized the hike, noting that it will likely drive customers in border districts to seek cheaper fuel in neighboring states, negatively impacting local sales.

Fuel prices in Punjab are set to increase following a decision by the state Cabinet to raise the value-added tax (VAT) on petrol and diesel. On Thursday, the council of ministers, chaired by Punjab Chief Minister Bhagwant Mann, approved a VAT increase of 61 paise per litre for petrol and 92 paise per litre for diesel.

Currently, the retail price of petrol in Mohali is Rs 97.01 per litre, while diesel is priced at Rs 87.21 per litre. These rates are already higher than those in Chandigarh, where petrol costs Rs 94.24 per litre and diesel is Rs 82.40 per litre.

Finance Minister Harpal Singh Cheema, addressing the media after the Cabinet meeting, explained that the VAT increase is expected to generate an additional Rs 395 crore in revenue from diesel and Rs 150 crore from petrol.