October 4, 2014 by admin

Punjab govt raises value added tax on diesel, cold drinks, cigarette

Chandigarh, People will have to pay more for diesel, aerated drinks and cigarette in Punjab with SAD-BJP led state government raising value added tax (VAT) on these products.

In a notification issued on October 1, Punjab excise and taxation department has increased VAT rate on diesel (other than premium diesel), cold drinks (including aerated drinks, soda) and cigarette and cigar by 1 per cent, 5 per cent and 9.5 per cent respectively.

With this hike, the tax on diesel has increased to 9.75 per cent while VAT on cold drinks and cigarette have jumped to 27.5 per cent and 30 per cent.

Punjab also levies 10 per cent surcharge on VAT rates.

After levying surcharge, the effective tax rates on diesel, beverages, cigarette will be 10.72 per cent, 30.25 per cent and 33 per cent respectively, said an official of Punjab excise and taxation department.

After the hike in VAT on diesel, the retail price of diesel has jumped by 55 paise a litre to Rs. 58.11 per litre.

Punjab annually collects about Rs. 2,600 crore of tax from petroleum products.