The income from the sales tax on the hiked petrol price to the state government is expected to Rs194 crore a year. The windfall in the rest of the five and a half month of this financial year will be Rs89 crore.
Even as the common man feels the heat of the petrol price hike, the state finance department has a reason to smile.
The income from the sales tax on the hiked petrol price to the state government is expected to Rs194 crore a year. The windfall in the rest of the five and a half month of this financial year will be Rs89 crore.
The state government levies 26% sales tax and cess of Re1 per litre on petrol.
The expected income from the sales tax on diesel, petrol and air turbine fuel in the current financial year was Rs10,587 crore, against the collection of Rs9,397 crore last year. The earning of the price hike is expected to be a major help in achieving the target.
Though there is no demand so far from any quarters for the reduction of the sales tax to reduce the effect of the hike, officials from the sales tax department feel that it was unlikely that government would accept it.
“Even if the government reduces the tax, it would bring down the price by less than 50paise,” said an official.
He said that Maharashtra was among those states which levy the highest sales tax on petrol in the country.
It is 26% in Mumbai, Thane and Navi Mumbai and 25% in the rest of the Maharashtra, apart from the cess of Re1 per litre. After an uproar on the price hike of diesel and kerosene in June, the state government reduced the sales tax on diesel by 3%.
That had led to the annual loss of Rs416 crore to the exchequer and another Rs22 crore due to the tax reduction on kerosene. There was an demand to reduce the cost of domestic cylinder by at least Rs25 after the hike of Rs50 per cylinder in June. The government refused as the loss to the exchequer would have been nearly Rs500 crore a year.
The government gained Rs194 crore from the petrol price hike by Rs5 a litre in May.
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