FUEL GETS CHEAPER IN MAHA, GUJARAT

Mumbai: Petrol will be cheaper by `2 and diesel by `1 per litre across Maharashtra from Tuesday midnight after the government reduced the VAT on the fuels. Similarly, in Gujarat, the price of petrol will come down by `2.93 and that of diesel by `2.72 .

Responding to the Centre’s appeal to reduce Value Added Tax (VAT) on petrol and diesel, Maharashtra government on Tuesday cut prices by `2 for petrol and `1 for diesel respectively. The revised fuel rates would be applicable from Tuesday midnight.

“We have reduced petrol prices by `2 and diesel prices by `1 to bring some relief for the people. This will put a burden of about `2,000 crore on the state exchequer. The government is ready to bear the additional financial burden despite Maharashtra’s economy not being in good shape,” state finance minister Sudhir Mungantiwar said.

The state will have to bear burden of about `940 crore for reducing petrol prices and about `1,075 crore for the cut in diesel prices.

Maharashtra has a different level of taxes on petroleum products.

The state government has been criticised in the past for having the highest taxes on petroleum products in the country.

However, BJP leaders have supported these taxes by citing the use of revenue generated from them being used for developmental projects.

Looking at the backlash over high petrol prices however, the Centre has slashed tax on petrol by `1.17 per litre. At the same time, the Union finance ministry had asked the state government to reduce taxes. Maharashtra pockets `7,300 crore from petrol taxes and `10,500 crore from diesel taxes.

Only these states have reduced VAT on fuel.