Petrol and diesel products will become cheaper in Maharashtra
from midnight on Tuesday due to four per cent reduction in Value Added Tax
(VAT), an official said in Mumbai.
The net reduction in petrol and diesel prices will be around Rs 2.33 per litre and Rs 1.25 per litre respectively, though the various cess levied by the state have not been reduced, said All India Petrol Dealers Association Spokesperson Ali Daruwala.
The move follows a communication from Union Finance Minister Arun Jaitley to all state governments to consider reducing state-level taxes on petrol and diesel products, which increase prices at local levels.
Mumbai Petroleum Dealers Association President Ravi Shinde said the current VAT
in the state is around 26 per cent on petrol and 21 per cent on diesel, plus different cess totalling Rs 9 per litre. This leads to a hike in the prices of petrol and diesel by nearly 50 per cent for every litre in the state.
"Our demand for reduction in cess on petrol and diesel products by the state government was rejected and we were informed that it is utilised to repay farm loans waiver package announced in June," Daruwala told IANS.
With the reduction in VAT, the Maharashtra
government is likely to suffer a loss of around Rs 2,500 crore.
Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.
We, however, have a request.
As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.
Support quality journalism and subscribe to Business Standard.