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Higher cess on auto fuels likely

india Updated: Feb 23, 2013 01:46 IST
HT Correspondents

Notwithstanding the ongoing periodic hikes in petrol and diesel prices, a steep hike in auto fuel prices may come your way if the proposal to hike road cess in the upcoming budget is implemented by finance minister P Chidambaram.

Senior government officials said the finance minister may either further hike the road cess that one pays on these fuels - currently at Rs. 2 a litre or levy a new cess for development of public transport like metro rail. “The new cess could also be termed as “green cess” to fund public transport.”

The government had collected Rs. 38,700 crore during the 11th plan as part of the cess of Rs. 2 a litre that is being levied on these fuels since 2000-01 under the Central Road Fund Act, 2000.

According to the CRFA, 50% of the collections from cess on diesel and the entire money from the cess on petrol was to be spent on development and maintenance of national highways, construction of railway over-bridges or under-bridges and for development and maintenance of roads other than national highways or roads of economic importance.

Sources said the proposal was also part of the Planning Commission’s 12th five year plan (2012-17) document and the Rangarajan expert panel committee report that was recently submitted to the government.

As much as Rs. 4.80 lakh crore of funds are needed for development and maintenance of highways and expressways in 12th Five Year Plan period.

Budget allocation for rural plans

New Delhi: The ministry of rural development, which runs the UPA’s flagship aam admi programmes like MG-NREGA and Indira Awas Yojana is likely to see an increase of over Rs. 4000 crore in the Budget to be unveiled next week.

According to sources, the allocation for the largest social sector ministry would be about Rs. 80,700 crore in 2013-14.

The modest increase of 5.5% in the Budget preceding the election year is attributed to the revenue constraints resulting from the economic slowdown.

The main gainer would be the Integrated Watershed Management Programme.