Biodiesel 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 bio-diesel 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.
"The states are required to declare a promotional VAT rate for bio-diesel blending. A small 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.
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