Published: Tue, October 10, 2017
Worldwide | By Gretchen Simon

Maharashtra, Gujarat cut Value-Added Tax on petrol and diesel

Maharashtra, Gujarat cut Value-Added Tax on petrol and diesel

Hours after Gujarat government announced that it has slashed the value-added tax (VAT) on petrol and diesel, Mahasrashtra Cabinet also made a decision to cut taxes on oil to bring down prices of fuel in the state. As a result the price of petrol will be Rs 67.53 per litre and diesel Rs 60.77 in Ahmedabad.

Gujarat Chief Minister Vijay Rupani has announced a 4 per cent reduction in Value Added Tax on petrol and diesel.

The central government last week, had announced cutting the excise duty on fuel to help lessen the customer burden at a time when the global prices are gradually going up.

The finance ministry also said that the move has been done to cushion the impact of rising global prices of crude petroleum oil and petrol and diesel on their retail sale prices.

This move of the Centre and state government's come in the wake of criticism by consumers over the dynamic pricing of petrol and diesel.

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The step that followed the central government's decision to cut excise duty on petrol and diesel by 2 per cent, comes just before Diwali and ahead of the assembly polls due by year-end and follows. The petroleum minister Dharmendra Pradhan said that now it is up to state to take the responsibility and join hands with centre for the benefit of the country.

With the reduction in Value-Added Tax, the Maharashtra government is likely to suffer a loss of around Rs 2,500 crore. "We have proactively cut excise duty".

Pradhan said that the Centre has sacrificed Rs 26,000 crore in revenue in the cut in excise duty. Recently, the petrol price in the national capital touched Rs70.83 per litre, highest since 16 January.

Jaitley on October 04, mentioned a large part of taxes collected on petroleum products goes to states.

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