SHILLONG, July 1 � Meghalaya today exempted Value Added Tax (VAT) on cooking gas, kerosene and diesel to provide relief to consumers.
With this decision, Meghalaya joins a handful of other States and Union Territories in India like West Bengal, Haryana and Delhi which had earlier reduced VAT on some of these products. The State VAT on LPG and kerosene is five per cent and diesel 12.5 per cent.
The decision to reduce VAT on these items was taken by the Cabinet today after the UPA Government raised prices of these products on June 25.
The Ministry of Petroleum and Natural Gas increased the price of Liquefied Petroleum Gas or cooking gas by Rs 50, kerosene Rs 2 and diesel by Rs 3 per litre due to spill over effect of increase in price of crude oil in the International market.
The Cabinet�s decision would provide relief to the extent of Rs 20.13 paise per domestic cylinder of LPG, Re 0.67 paise per litre in respect of Kerosene and exemption of Rs 0.50 paise per litre of diesel.
�Taking due note of the public concerns and after due deliberations, the Cabinet has decided to give full exemption of tax on kerosene and LPG,� Chief Minister Mukul Sangma said.
Due to these tax exemptions, the State�s loss of revenue would work up to Rs 9.52 crore annually. The break up of the annual loss, he said, would be Rs 7.03 crore for tax exemption on diesel, Rs 1.76 crore for LPG and Rs 0.73 crore for kerosene.
Meanwhile, Sangma added the Government has already formulated a number of steps for mobilisation of additional resources to make up for the revenue losses.