Assam hikes oil prices steeply despite global dip

Move follows State Finance Minister’s fear over meeting June expenditure if there was no infusion of funds

Published - April 22, 2020 11:46 am IST - GUWAHATI:

Himanta Biswa Sarma

Himanta Biswa Sarma

A litre of fuel went up by almost ₹6 in Assam from Wednesday despite global crude oil prices hitting rock bottom.

The State’s Finance (Taxation) Department issued a notification modifying the rates of tax on diesel and petrol.

The notification by Principal Secretary Samir Kumar Sinha on Tuesday evening said the tax rates had been increased under a relevant section of the Assam Value Added Tax Act, 2003.

A State can impose tax only on fuel and liquor.

Accordingly, the VAT on diesel was modified to “23.66 paise in the rupee or ₹17.45 per litre, whichever is higher” and that of petrol and other motor spirits to “32.66 paise in the rupee or ₹22.63 per litre, whichever is higher”.

This worked out to an increase in retail prices of diesel and petrol by almost ₹6 per litre, officials of the department said. From the midnight of April 21, the price of diesel increased from ₹65.07 to ₹70.50 and of petrol from ₹71.61 to ₹77.46 per litre.

The fuel price hike followed Finance Minister Himanta Biswa Sarma’s fear that Assam might not be able to meet expenditure in June, including paying salaries to about 5 lakh State government employees if there was no infusion of funds.

“The finances of the State have suffered due to COVID-19lockdown ,” he said a few days ago.

Fuel prices in Assam have usually been higher than most of the adjoining hill States in the northeast. The price hike from Wednesday is likely to widen the gap.

Many vehicle owners and operators in border areas, including Guwahati, buy fuel from the neighbouring States to save money. People in areas bordering Bhutan, where fuel is at least 25% cheaper, often avoid local fuel outlets.

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