Madhya Pradesh to Levy 50 Paisa per Litre Cess on Petrol-Diesel to Raise Funds for Roads

The Union Budget, as presented by Finance Minister Arun Jaitley, reduced basic excise duty on branded and unbranded petrol as well as diesel.

Bhopal: Petrol-diesel is going to be costlier in Madhya Pradesh. The state’s cabinet paved the way for the fuel getting costlier by levying cess of 50 paisa a litre for boosting ‘infrastructure’ in the state.

The cabinet has approved an ordinance, MP Motor Speed Bill 2018, which enabled government to levy 50 paisa per litre cess on petrol and diesel and the funds would be invested into infrastructure development and improvement of traffic, MP government’s spokesperson Narottam Mishra told newsmen after the meeting was over in state capital.

The ordinance has now been sent to Commercial Tax Department and the levy would take time and isn’t immediate, he clarified.

The state government is expected to raise Rs 200 crore per year through this cess

“A notification would be issued soon in this regard and amount raised through this would be used for betterment of roads and metro projects,” state finance minister Jayant Malaiya said. Interestingly, CM Chouhan recently drawn flak saying that roads in MP were much better than those in the US.

Despite state government claims of massive road development in MP, the state’s roads are crumbling and insiders from BJP claimed that a large numbers of Bharatiya Janata Party legislators have approached Public Works Department with road development proposals in their respective constituencies ahead of the upcoming polls.

President of Congress’ ideation wing Vichar Vibhag Bhupendra Gupta told News18 that now commoners have fourth cess to pay for crumbling roads after toll tax, road tax, and Centre’s cess on diesel. It’s only meant to fund MP government’s lavish functions and roads won’t improve through this, he claimed.

Recently the MP government has cut down VAT on petrol-diesel by 3% and 5% respectively to offer relief to the common man on Centre’s initiative. This reportedly poked a hole of Rs 2000 crore per annum in state exchequer’s pocket.

Already in fiscal trouble, the MP government has been borrowing funds heavily and the GST led decline in tax collection has jolted the financial management of the state.The MP govt has already hiked registry fee and slashed interest offered on EPF accounts.