Forget rehabilitation, JK Govt ‘burdens’ people with hike in petrol, diesel taxes

At a time when J&K’s economy is grappling to come to terms with aftereffects of devastating floods last year, the state government’s move to hike rate of tax on petrol and diesel has further burdened common people, experts have opined.

The Jammu and Kashmir government has increased the rate of tax on sale of motor spirit and diesel by four percent each.

Earlier the rate of tax on petrol was 20 percent which is 24 percent at present.

Similarly, for diesel the rate of tax is 16 percent now as against 12 percent earlier.

The increase in tax rate means the price of petrol and diesel has gone up by Rs 2.20 and Rs 1.76 in J&K respectively. Diesel is now sold at Rs 53.27 a litre and petrol Rs 72.76 a litre.

The orders in this regard was issued by Navin K Choudhary, Commissioner Secretary, Finance Department, in exercise of the powers conferred by Section 3 of the Jammu and Kashmir Motor Spirit and Diesel Oil (Taxation of Sale) Act and in supersession of notifications SRO-118 dated April 1, 1999 and SRO-3 dated January 27, 2000.

However as per official data available with us, people in Kashmir are charged Rs 18.2 a litre as tax including Rs 3 as CESS per litre. The rate of petrol before taxes was Rs 54.54 a litre and Rs 72.76 a litre after levy of various taxes by state government.

On diesel, imported at Rs 43.97 a litre, the price has gone up by Rs 9.3 a litre including Rs 1 per litreCess, after imposition of various taxes. Post taxation the price of diesel in Kashmir has gone up to Rs 53.27 a litre.

Curiously as per experts, the hike in tax rate of these products would drain the economy of local people who are already suffering due to September-2014 deluge.

“Consumption of petrol in Kashmir is around 7 lakh litre and diesel 14 lakh litre. When state increase the tax it means people have to pay extra money and at the same time the cost of transport would increase which automatically means inflation,” said an expert.

President, Kashmir Traders and Manufacturers Federation (Baqal Faction), Muhammad SadiqBaqal said it is “another gift” from the state government to “hapless people of Kashmir.”

“We have been denied even compensation of losses we suffered due to devastating floods and now see what this government is up to. By increasing the tax rate, the government has once again showcased its insensitivity towards suffering of people,” Baqal said, the hike in petroleum prices acts as catalyst for inflation and rising prices of essentials.

A senior Finance department official told  that the rate of tax was hiked “because it was overdue.”

“It would help state to mobilize additional revenue,” he said, adding, “There is nothing wrong in revising the tax rates after few years.”