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Bengal govt reduces tax on petrol, diesel by Re 1 per litre

Bengal govt reduces tax on petrol, diesel by Re 1 per litre

Kolkata: Bringing respite to the people stung by spiralling fuel prices, the Mamata Banerjee government announced a reduction of state tax by Re 1 per litre on the prices of petrol and diesel from February 22 night.

Despite being faced with a financial crunch due to the double whammy of COVID and Amphan, the state government took the decision to come to the rescue of common people.

The Bengal government is the first in the country to reduce the state tax throwing a challenge before the BJP-led Centre to slash its taxes on petrol and diesel—major portion of which is cess— at a time when the price of petrol has reached Rs 91.78 per litre. The cost of diesel stands at Rs 84.66 per litre.

"To reduce the common man's burden, the State Government has decided to allow rebate of Re 1 per litre on sales tax payable on sales of petrol and diesel w.e.f. the end of midnight of 22nd February, 2021 till 30th day of June, 2021," tweeted state Finance minister Amit Mitra.

"It is the humane approach of Chief Minister Mamata Banerjee to provide respite to the people when the prices of petrol and diesel have skyrocketed. The step has been taken following the direction of the Chief Minister and it would also benefit farmers as they use diesel for agricultural purposes," said the state Finance minister Amit Mitra in a virtual Press conference on Sunday.

The prices of petrol and diesel have been continuously increasing for the past 15 days. The price of petrol has remained above Rs 90 per litre. In some states, the price of petrol has even crossed the Rs 100-mark. In Mumbai, petrol is at an all-time high of Rs 97 per litre, while diesel rate crossed Rs 88-mark.

The Centre is collecting tax and cess of Rs 32.90 per litre and Rs 31.80 per litre on petrol and diesel respectively. Most importantly, the Centre levies 62 and 69 per cent cess on petrol and diesel respectively. "It is important to note that the states do not get a share out of any cess collection, unlike 42 per cent in case of other taxes. So basically, this government has increased the aggregate cess from 8 to 16 per cent in the past six years. It is highly depriving all the states in the country," Mitra said.

When asked whether the Union Finance minister Nirmala Sitharaman has sought talks between the Centre and states in connection with price rise, Mitra said: "We are always ready for talks. But, they must first put forward their plan of reducing the central taxes. We have announced reduction in state tax for the fuel. But, what did they do so far?"

The state's tax on petrol and diesel will come down to Rs 17.46 per litre and Rs 11.57 per litre for petrol and diesel respectively with Mamata Banerjee's decision of bringing down the same by Re 1 per litre.

The state government had reduced the state tax by Re 1 a couple of years ago when there was an abnormal hike in prices of petrol and diesel.

Tushar Sen, president of the West Bengal Petroleum Dealers Association, said: "Both, common people and dealers will get benefited by the decision.

It was our long-standing demand and we express our gratitude to the Chief Minister welcoming the decision."

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