Petrol, diesel to cost more in Andhra Pradesh

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This is the second time in two months that the Y S Jagan Mohan Reddy government has increased the tax on the automobile fuel

The Andhra Pradesh government has added another levy to the highly taxed petrol and high-speed diesel through an ordinance to net around Rs.500 crore annually.

The levy comes in the form of a Road Development Cess of Re 1 each per litre on petrol and high- speed diesel. An ordinance in this regard was cleared by Governor Biswabhusan Harichandan on Friday, September 18.

The cess under the AP Value Added Tax Act, 2005 will be in addition to the existing levies on petrol and diesel, said a PTI report. Special Chief Secretary (Revenue) Rajat Bhargava said that the state cabinet had taken the decision to impose the cess considering the necessity of allocating dedicated funds for the development of roads in the state.

The cess amount would be transferred to the Andhra Pradesh Road Development Corporation for exclusive use in developing road infrastructure, he said.

This is the second time in two months that the Y S Jagan Mohan Reddy government has increased the tax on the automobile fuel. On July 20, year the government revised the tax structure on petrol and diesel, thereby increasing their price by Rs 1.24 and Rs 0.93 per litre respectively, to mop up an additional revenue of about Rs 600 crore per annum.

The new cess will be entirely used for carrying out road works, including the much-needed repairs through the APRDC. Of the total to be realised, we plan to give at least Rs 100 crore to the urban local bodies which otherwise do not have access to such money, a top official told PTI.

It had borrowed Rs 3,000 crore in February 2019 but all that was used by the previous Chandrababu Naidu regime towards a freebie scheme "Pasupu-Kumkuma". Beginning November this year, the RDC has to start paying interest on the loan as the moratorium period ends. Besides, a portion of the principal also needs to be repaid.

Principal and interest together will be around Rs 50 crore a month, the top official said, implying that at least Rs 600 crore is required per annum (with inputs from PTI)

Image Credit: The Hindu

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