Vadodara folks to bear brunt of Vat on gas

The Financial Express, Vadodara
In the wake of Vadodara Municipal Corporation (VMC) decision to impose 12.5% value added tax (Vat) on gas from the month of December 2006, nearly 60,0 00 natural gas users in the city will have to bear additional Rs 1.75 crore burden annually. Informing that the VMC has already started the process for imposing the 12.5% Vat on gas, Manoj Dar, commissioner of the corporation, said, policy level proposal regarding imposition of 12.5% Vat on gas has been referred to a standing committee. The VMC has proposed the Vat on gas. This will be implemented with effect from December 1, 2006.

In addition to this, gas users in the city are given two months bill and gas charges are levied on two-month basis. However, as per the new changes mooted by the VMC, gas users will be issued monthly bills, which will also include 12.5% Vat and collection will also be made on monthly basis.

Speaking to FE about the additional burden on users on account of imposition of 12.5% Vat on gas, sources in the corporation said, The VMC gets daily 1,00,000 cubic meter gas supply from GAIL, which distributed among 60,000 natural gas users in the city. The VMC collects Rs 1.15 crore per month from gas users. Now with addition of 12.5% Vat, users will have to bear addition burden of Rs 12- Rs 15 lakh per month, which works out to be Rs 1.75 crore per annum.