Announcing the proposal, Chief Minister Sheila Dikshit said her government would incur a burden of nearly Rs.140 crore in revenue on this count. However, it would be more than covering up for this loss by imposing five per cent VAT on Compressed Natural Gas, on which the entire public transport in the city now runs. The move is expected to result in a hike in auto-rickshaw and taxi fares.

In her budget speech, Ms. Dikshit delved on how since the introduction of the VAT system in Delhi, CNG has always been exempted from its purview “though the same should be taxed @ 12.5 per cent as per the recommendations of the Empowered Committee of State Finance Ministers.”