Petrol, diesel prices rise in Punjab as the AAP government increases VAT on fuel

The Aam Aadmi government in Punjab increased the Petrol and diesel prices by 92 paise and 88 paise per litre, respectively, following the upward revision in value-added tax (VAT) on fuel by the state government, a move which drew a sharp reaction from the opposition parties.

Calling the increase in fuel prices an “anti-people” decision of the AAP government, the opposition parties said it would put an additional burden on the common man and farmers.

Following the increase in VAT, retail prices of petrol (in Mohali) rose to Rs 98.95 a litre and of diesel to Rs 89.25 per litre, fuel pump owners said on Sunday. As per the latest data by Oil Marketing companies, petrol prices is at the range of Rs 98 as of 10 June in every city of Punjab.

The new retail prices have come into effect from midnight of June 10 and 11. This is the second time that fuel prices were increased this year. In February, the AAP government imposed a cess of 90 paise per litre on both petrol and diesel.

The notification with regard to the increase in VAT on fuel was issued by the state excise and taxation department on Saturday.

Mohali-based fuel owner Ashwinder Singh Mongia said VAT on diesel has been increased by 1.13 percentage points to 12%, while tax on petrol has been increased by 1.08 percentage points to 15.74%.

Mongia said with the hike in VAT, the petrol and diesel rates in Punjab will be more than what prevails in neighbouring states.

Giving a comparison of the fuel prices in neighbouring states, Mongia said retail prices of diesel and petrol in UT Chandigarh stood at Rs 84.26 per litre and Rs 96.20 a litre, respectively.

In Himachal Pradesh, the price of diesel was Rs 85.44 per litre and that of petrol was Rs 96.29 per litre.

Shiromani Akali Dal chief Sukhbir Singh Badal condemned the Aam Aadmi Party (AAP) government for putting an “unprecedented” burden on the common man and farmers by increasing VAT on petrol and diesel.

Demanding an immediate withdrawal of the arbitrary increase, the SAD president said, “Instead of causing misery to the common man the government should save money by putting the brakes on its multi-hundred crore advertising spend.” “There won't be any need to raise additional resources as is being asserted by the AAP government if it ends its reckless advertisements as well as publicity gimmicks”.

Badal said on the one hand the government was claiming that it was giving 300 units free power but on the other it “severely pruned” several social welfare benefits including old age pension scheme, Aatta - daal scheme, Shagun scheme and SC Scholarship scheme.

"Now it has increased VAT on petrol and diesel. This only shows the duplicitous nature of this government which is taxing the people above and beyond the benefits extended to them. It is a true case of giving with one hand and taking back with two”, Badal said in a statement.

Punjab Congress chief Amrinder Singh Raja Warring also condemned the increase in fuel prices.

“Another anti-people decision of @BhagwantMann led @AAPPunjab govt. Hike in #PetrolDiesel prices has once again exposed the failure & incompetence of @AamAadmiParty-led #PunjabGovt. This will only add financial burden on millions of Punjabis. @INCPunjab strongly condemns the announcement & appeals to the govt to repeal the price hike,” said Warring in his tweet.