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Maharashtra, Gujarat and Himachal Pradesh on Tuesday reduced value-added tax (VAT) on petrol and diesel. The move follows the Centre cutting excise duty on petrol and diesel by Rs 2 per litre last week. Petrol in Maharashtra will be cheaper by Rs 2 and diesel by Rs 1 per litre from Wednesday. Finance Minister Sudhir Mungantiwar said the decision would cause an annual revenue loss of Rs 2,000 crore to the state exchequer but “the government is ready to bear the additional financial burden despite Maharashtra's economy not being in a good shape.” Gujarat cut VAT on petrol and diesel by 4 per cent.
The effective price of petrol in Gujarat will be Rs 67.53 a litre and that of diesel Rs 60.77 per litre, Chief Minister Vijay Rupani said. “We have taken this decision in the interest of the people. The decision should not be considered to have any links with the polls. This is only aimed at giving relief to the people and it is a permanent decision.” The Himachal government reduced VAT on petrol and diesel by 1 per cent, said Chief Minister Virbhadra Singh.