No proposal to cut trade tax on diesel

PUTTING A full stop to the speculations, the state government today categorically denied that there was any proposal to reduce the trade tax on diesel.

PUTTING A full stop to the speculations, the state government today categorically denied that there was any proposal to reduce the trade tax on diesel.

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“We have no plans to slash the trade tax on diesel and there is no such proposal under consideration,” Principal Secretary (Trade Tax) K Chandramauli told Hindustan Times. He said reports about the government considering to bring down the trade tax on diesel from the existing 22 per cent to 12 per cent were not true.

Trade Tax Commissioner Rajnish Gupta also said that he was not aware if there was any proposal to reduce the tax on diesel. “Though it is a policy matter to be decided by the government, his department had not yet proposed any tax cut,” he said.

Sources said the petrol dealers’ association was, of course, demanding reduction in the tax rates and had also met the chief minister in this regard. They said the sale of diesel in UP had certainly come down with more and more truckers and farmers buying diesel from the neighbouring States of Delhi and Haryana where the tax was as low as 12 per cent. Still, there was no proposal to reduce the taxes, they said.

At present, the trade tax department levies 22 per cent tax including one per cent development tax plus 5 per cent entry tax.

However, the department minuses the 5 per cent entry tax in the final calculations, thereby recovering only 22 per cent of the tax.

But desperate to meet its tall revenue targets for the year, the trade tax department last week proposed to the Government that the 5 per cent tax be recovered separately totalling the tax amount to 27 per cent.

However, the chief secretary to whom the proposal was put got a bit angry and shot down the proposal, said a senior officer.