Partial relief to Delhi residents as VAT on LPG withdrawn

March 29th, 2010 - 8:36 pm ICT by IANS  

Bharatiya Janata Party New Delhi, March 29 (IANS) In a partial relief to Delhiites, the Delhi government Monday withdrew Value Added Tax (VAT) on domestic cooking gas and rolled back the increase on essential items like CNG, tea and coffee.
Finance Minister A.K. Walia, in his budget for 2010-11 presented last week, had proposed to withdraw the Rs.40 subsidy on LPG (Liquefied Petroleum Gas) and an increased VAT on diesel and CNG besides a lot of other essential items such as tea and coffee.

The government had justified the hike in taxes, contending its resources were exhausted meeting the expenditure on the Commonwealth Games preparations.

The proposals came under fire from the Bharatiya Janata Party (BJP)-led opposition and were also criticised by Delhi residents, who are already reeling under the soaring inflation in food prices.

Buckling under the pressure, the government Monday decided to withdraw four percent VAT on LPG and got the budget passed.

After the withdrawal of the subsidy, a domestic LPG cylinder was to cost around Rs.322 per cylinder. But after Walia exempted LPG from VAT, it would now cost around Rs.310 per cylinder. The government said this was the price in the neighbouring states too.

The VAT proposed on CNG, embroidery and zari items, motion picture distribution, plastic and glass scrap was rolled back, while the government also decided not to go ahead with the proposed increase in VAT on tea, coffee and utensils including pressure cookers.

Walia had proposed an increase in Value Added Tax (VAT) on diesel, CNG, mobile phones and accessories costing above Rs.10,000, watches and ready-made garments above Rs.5,000, fertilisers, kerosene, coffee, tea, desi ghee, dry fruits, kesar (saffron), glucose-D, household plastic items, utensils and cutlery items and inverters.

However, the government went ahead with the increased VAT on diesel from 12.5 percent to 20 percent, which will make it Rs.2.37 costlier.

Earlier during the day, chaos prevailed in the Delhi Legislative Assembly when BJP legislators came towards the speaker’s podium and raised slogans against the government, demanding withdrawal of subsidy on cooking gas and increase in VAT on several items. They also demanded a discussion on the price rise.

Speaker Yoganand Shastri refused their demand and asked them to go back to their seats. But when they did not, they were removed from the house. However, they soon started protesting outside after which the police took them away.

Meanwhile, BJP councillors in the Municipal Corporation of Delhi (MCD) also staged a demonstration outside the assembly in the afternoon against price rise. But as they tried to go towards the assembly, the police used water cannons to disperse them.

The BJP claimed many of their workers, including Municipal Corporation of Delhi’s Standing Committee Chairman Ram Kishan Singhal, suffered injuries in the incident

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