Maharashtra Budget Sees Drastic Cut in VAT on CNG. Here’s How Much It Will be Reduced

The move will hugely benefit households with piped natural gas connections and CNG power vehicles, while the state will incur a revenue shortfall of around Rs 800 crore.

Mumbai: Maharashtra Deputy Chief Minister and Finance Minister Ajit Pawar on Friday presented the state Budget 2022-2023 with a revenue deficit of Rs 24,353 crore, with a slew of major announcements like an amnesty scheme for GST and stamp duty and reduction in VAT for natural gas. Pawar proposed a drastic reduction in Value Added Tax (VAT) on domestic piped Compressed Natural Gas (CNG) as well as vehicle owners. Pawar proposed that the VAT on CNG in the state be reduced to 3% from existing 13.5%.

The move will hugely benefit households with piped natural gas connections and CNG power vehicles, while the state will incur a revenue shortfall of around Rs 800 crore. The state finance minister made the proposition during the state’s budget session being presented in the Assembly on Friday. Pawar also mentioned that this reduction will cause a revenue loss of Rs 800 crore annually.

Natural gas is “environment-friendly” and is largely used for domestic piped gas supply and also for CNG-powered motor vehicles, auto-rickshaws, taxis and private vehicles, the minister said.

(With agency inputs)