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Dealers are saying that
diesel sales have dipped by more than 40% in the capital because of the increase
in VAT rate. On Sunday, huge banners that said "Monday closed" was put up at all
outlets in the city.
Delhi government had in April this year increased the VAT on diesel.
"Due to the increase in VAT, diesel has become costlier in the capital. Now the
commodity costs Rs 4 more in Delhi as compared to what it costs in Haryana. As a
result, motorists are getting their vehicles filled in NCR towns such as Gurgaon
and Faridabad," said a dealer. He added that an off-day a week will also help
them in cutting costs. Earlier on May 14, petrol pump owners had closed their
shutters for 24 hours pressing for a rollback in VAT rates.
Finance minister A K Walia has so far kept his ground despite sustained pressure
from pump owners. He has pulled out comparative VAT collection figures of
2009-10 and 2010-11 to drive home the point that government's revenue
collections have increased even if sales may be "marginally down in the pumps
that are near the borders."
He maintained that as the Union government gradually moves to a uniform tax
regime from the next financial year, a lower VAT may cause the government to
lose out on Central assistance, something that the city government already in
the throes of a deepening financial crunch, cannot afford to risk.
"The uniform flow rate that has been prescribed will have to be followed," the
finance minister said.
Source: Times of India, India, dated
24/05/2010
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