The Delhi government announced on March 29 to roll back VAT on cooking gas cylinders and CNG. They decided to withdraw 4 percent VAT on LPG cylinders and 5 percent on CNG, which is used by buses and auto-rickshaws in Delhi.

Finance Minister A K Walia has submitted the budget on March 22 and this turnaround took place exactly after one week of submitting the budget, in which Walia withdrew the subsidy of Rs 40 per LPG Cylinder. After this rollback, LPG cylinder would cost RS 310 from April 1, which was earlier decided to cost at Rs 322, present cost of the cylinder is Rs 282.

On the budget day opposition members were creating disturbance and one of the leader VK Malhotra was asked by the speaker to leave the House. They were demanding to withdraw VAT on all the items.

Walia declared that VAT will be withdrawn from various items like coffee, tea cocoa , i. e 5 per cent Vat will be charged which is lower than the previously announced 12.5 percent. He also announces that plastic and glass scrap, embroidery zari items have also set VAT free.

To balance all these VAT withdrawals, he roundabout increases the registration fee on vehicles and prices of liquor.

Walia told the reporters after the assembly, that when the VAT was not rolled back, the government had planned to earn RS 1030 crore revenue but VAT withdrawls on few items made revenue to come down by Rs 250 crore.

He also indicates a number of other plans to the government, to increase its revenue like he said that transport department has lots of innovative schemes through which lost revenue can be covered.

He said that transport department has increased registration fee on vehicles: Registration fees for cars costing up to Rs 4 lakh will be increased from 2 percent to 4 percent and registration fees for cars costing above Rs 4 lakh will be increased from 4 to 9 percent.

He said that matter related to increase the prices of liquor is still pending because new excise policy is under process.

Finance Minister told the sources that VAT has been increased on goods like kerosene stoves, lanterns and petromax as these goods are used by minimal ratio of the population along with this VAT on diesel increases from 12.5 per cent to 20 per cent.

He believes that lost in the revenue will be covered by increasing registration fees on vehicles and increasing the prices of liquor as it is expected that hike in the registration fees will generate revenue of Rs 200 crore and increasing the prices of liquor will generate Rs 100 crore revenue for the government.

Concluding this report, he repeatedly told the reporters that despite of increase in VAT, Delhi remains the lowest tax paid state.