GUJARAT & Maharashtra Make Petrol & Diesel Cheaper By Reducing VAT

October 11th, 2017 | by eBangla Bureau
GUJARAT & Maharashtra Make Petrol & Diesel Cheaper By Reducing VAT
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PETROL and diesel prices have been reduced substantially by two western States Gujarat and Maharashtra from Tuesday reducing Value Added tax (VAT) on the petroleum products. The centre has urged the States and the Union Territories to reduce VAT to make petroleum products. Madhya Pradesh has agreed to abide by the centre’s directive while Kerala has not accepted saying it cannot afford to incur revenue loss by reducing VAT. The Gujarat Government has announced to reduce the VAT on petrol and diesel by 4 per cent, Chief Minister Vijay Rupani said on Tuesday. The reduction in tax comes just before Diwali in the state, where the Assembly polls are due around the year-end. After Central Government’s instructions, Gujarat has decided to reduce VAT on petrol and diesel by 4 per cent from today midnight, Rupani said at a press conference .With this rate cut, the price of petrol will come down by Rs 2.93 and that of diesel by Rs 2.72 in the state, he said. The effective price of petrol in Gujarat from mid-night today will be Rs 66.53 per litre and that of diesel Rs 60.77 per litre, Rupani added. The state government will incur a loss of INR 2,316 crore annually. “But we have taken this decision in the interest of people,” Rupani said. The lowering of tax in the poll-bound Gujarat follows Union Finance Minister Arun Jaitley recently writing to all state governments nudging them to reduce taxes on petrol and diesel. The Centre had recently brought down excise duty on petrol and diesel by Rs 2 per litre. Petrol will be cheaper by Rs 2 and diesel by Re 1 per litre across Maharashtra from Tuesday midnight. State Finance Minister Sudhir Mungantiwar termed the announcement it as a “Diwali gift” to people of the state. Maharashtra will have to bear revenue loss of an estimated 2,000 INR annually due to lowering VAT. The revised rates will be applicable from midnight today, he said.“The chief minister has approved a proposal to reduce the VAT on petrol and diesel by Rs 2 and Re 1 a litre, respectively.

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