Karnataka plans VAT on fuel to fund family health insurance

The Karnataka government is considering imposing a 50-paisa to Re 1 cess on every litre of petrol and diesel sold in the state to generate funds for a Universal Health Scheme for below-poverty-line (BPL) cardholders. The proposed cess is expected to generate Rs 1,200 crore to Rs 1,500 crore per year, enabling the implementation of the health scheme. The scheme aims to provide Rs 25 lakh in health and accident coverage per person for the 1.8 crore BPL cardholders. The labour department is working on the proposal to submit to the government.