The State government has imposed a road development cess of ₹1 each on a litre of petrol and diesel to mobilise an estimated annual revenue of ₹500 crore, which will be transferred to the A.P. Road Development Corporation, according to a press release issued by Special Chief Secretary (revenue) Rajat Bhargava.
The government’s revenues plummeted from ₹4,480 crore in April 2019 to ₹1,323 crore due to the lockdown imposed to check the spread of COVID-19, he said.
The severe financial crunch continued in May, June, July and August as the State went through a phased reopening. The government was struggling to find resources to spend on the COVID-19 containment and on the slew of welfare schemes launched over the last one-and-a-half years, Mr. Rajat Bhargava said.
At the same time, the crucial road infrastructure needed to be augmented, he observed. Keeping the shoe-string budget in view, the Cabinet resolved to raise funds in the form of cess so that the government could undertake road development on a priority basis.
An ordinance for making an amendment to the AP Value Added Tax Act, 2005, was promulgated by the Governor. This facilitated the imposition of cess, which was in addition to other taxes on the fuels, the release added.
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