Petrol and Diesel might be imposed with Swachh Bharat Tax!

Indian government is planning to introduce a cess (tax) on petrol and diesel to fund the Swachh Bharat Campaign. It has already levied 0.5% tax on most of the services, since November 15, 2015, and is now likely to launch the same on petrol and diesel as well. Such attempts are being made at a time when the Government needs an investment of Rs. 2.23 lac crore by October 2019, to implement its plans for the project.

"Government is considering all options to raise funds for the programme and one or more of these could be announced as we go forward," said one of the officials familiar with the developments. Elaborating on the report he said, "It is very comprehensive in its coverage and requires huge amounts of funds to cover all aspects of the mission."

The fund-raising recommendations have been made by the NITI Aayog on advice of a sub-group of Chief Ministers. "The sharing pattern of funds for this programme between the Centre and States may be in the ratio of 75:25, while for hilly States it may be kept at 90:10," it said, with the larger proportion to be paid by the Centre. States have said that they can even issue Swachh Bharat bonds to encourage investment, provided the Centre would make them tax-free.

The largest share of investment is required by the toilets to be built under this programme. Approximately Rs 1.34 lac crore is required to build the facilities in rural areas alone. Announcement regarding this is expected to be made in the budget session, which will be held next month.

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