The Punjab government today decided to provide much needed relief to the people of the state by not charging Value Added Tax (VAT) on the recently increased amount of diesel and LPG.

With the exemption of VAT on the recently increased amount, diesel would become cheaper by approximately 25 paise per litre and LPG by Rs.2.50 per cylinder. To offset the price hike, the state government had given these concessions from its own resources benefiting the farmers, transporters and general consumers. With these concessions, the state government would lose about Rs 75 crore of revenue per annum.

Chief Minister Parkash Singh today slammed the Congress-led UPA government for arbitrarily increasing the prices of petroleum products time and again without taking states into confidence, which was `nothing but a sheer mockery of democratic values and so called federal structure.

He reiterated his stand to compensate the farmers of the state by immediately announcing a bonus of at least Rs 100 per quintal on paddy during the current kharif marketing season as the recent hike in prices of diesel had been effected deliberately by the Centre after the finalisation of current MSP for paddy.

Rejecting the ridiculous exemption of 25 paise VAT on 1 litre of diesel and Rs 2.50 on LPG, Punjab Pradesh Congress Committee president Capt Amarinder Singh today said it was a cruel joke on the people of the state. It only betrayed the intent of the government that it did not want to do anything but was only doing it to fool the public.

Earlier in the day, demanding that the Akali-BJP government in Punjab should immediately reduce VAT on petrol and diesel, Amarinder Singh said that the Akalis had no moral right to question the hike in the fuel prices and they were shedding crocodile tears only.

Amarinder said if the Akali-BJP regime were really sincere about providing relief to the people, instead of holding protests and dharnas it should reduce VAT on fuel as has been done by all the Congress and allied governments across the country. He said when he was the chief minister, he had reduced the taxes on fuel in Punjab to provide relief to the people.

Why cant the Akali-BJP government do the same thing? he asked.

Reacting to the demand by Badal for reducing diesel prices, Amarinder pointed out Punjab still charged highest VAT on diesel. Badal was only shedding crocodile tears as he must be happy over the hike as it will help his cash-starved government to generate additional few hundred crores of rupees.