Andhra govt hikes VAT on natural gas by 10%

To bridge the gap between state’s revenue and expenditure, the Andhra Pradesh government has increased VAT (Value-Added Tax) on natural gas from 14.5 percent to 24.5 percent. The state government outlined fall in revenue collections due to Covid-19 lockdown and increased expenditure on welfare schemes as the reasons behind this decision.

The government stated that the revenue collections in the month of April 2020 came down to Rs 1,323 crore against Rs 4,480 crore in the corresponding period of 2019. However, denying all rumours of increasing taxes on LPG as well, the government in a statement said that the news was propagated by some mischievous sections in the media. “This is totally misleading. LPG (Liquified Petroleum Gas) is different from natural gas. After introduction of GST in 2017, LPG along with all other goods are subsumed in GST. State governments have no power to revise the tax rates of GST subsumed goods including LPG,” the government said.

Meanwhile, the YSR Congress leader Vijay Sai Reddy lashed out at TDP leader Nara Lokesh. He tweeted, “Nara Lokesh does not know the difference between LPG and natural gas.” Earlier the TDP leader had criticised the government over VAT hike.