Petrol is now costlier by ₹1.24 a litre and diesel by ₹0.93 a litre in Andhra Pradesh as the state government has increased the value added tax or VAT on the two fuels. Amid a financial crunch led by the coronavirus pandemic and the subsequent lockdowns, the VAT hike will help the Andhra Pradesh government mop up additional annual revenue of ₹600 crore.
The state government issued an order yesterday amending provisions of the Andhra Pradesh Value Added Tax Act, 2005. Under the new rates, petrol will be taxed at 31% along with an additional levy of ₹4 while diesel will be taxed at 22.25% plus ₹4 per litre, respectively.
The state’s own resources have totally dried up because of reduction in revenues on account of the Covid-19-imposed lockdown. In April 2020, the state’s own revenues realised were only ₹1,323 crore as against ₹4,480 crore in April 2019, which was just 29.5 per cent of the total expected revenue.
