Tamil Nadu minister justifies VAT hike on fuel

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State commercial taxes department minister K C Veeramani justified the hike in value added tax (VAT) levied on petrol and diesel in Tamil Nadu imposed on Saturday.

Talking to reporters in Coimbatore on Monday on the sidelines of a review meeting on commercial taxes collection, Veeramani said the price of petrol and diesel was far less than several states in the country even after the hike.

The hike in VAT for petrol from 27% to 34% and for die sel from 21.4 % to 25 % by the state government which resulted in a steep rise in fuel prices has come in for severe criticism from political parties as well as public.

“For a long time we have not hiked VAT in Tamil Nadu. Even after the hike, VAT is Rs 1 lesser for petrol and diesel or in case of few other states, Tamil Nadu VAT rates are lesser by up to Rs 2,” he said.

The VAT has been hiked in a bid to increase the revenue reserves of the government, he said.

Though there was wide spread demand from various quarters for a rollback, the minister’s response justifying the rise indicated that the government was not looking at a price reversal, at least for now.

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