Bio-diesel Association of India (BDAI) today said it has sought relaxation of VAT on blending of bio-diesel for promoting green fuel blending and energy security in the country.
BDAI has also requested the Petroleum and Natural Gas Ministry to come up with a national bio-diesel policy to ensure fuel security.
“Currently, VAT on bio-diesel blending goes up to 24 per cent in several states and if they (states) do not provide promotional VAT rate on B5 blends, the blending in retail segment would be killed,” BDAI President Sandeep Chaturvedi said.
In its memorandum, the association has sought relaxation of VAT for major bio-diesel producing states like Gujarat, Andhra Pradesh, Telangana and Tamil Nadu.
Promotional rate
“The states are required to declare a promotional VAT rate for bio-diesel blending. A levy of 10 paise per litre on high speed diesel (HSD) could fund the entire blending programme,” Chaturvedi said.
“Bio-diesel is being promoted world over as a green fuel to mitigate harmful emissions from diesel vehicles. The promotion of this green fuel will have a positive impact on the urban and rural lifestyle by reducing chronic airborne diseases and disorders that have significant adverse impact on health of citizens in our country,” Chaturvedi added.