Mumbai: The State government has decided to cut petrol and diesel prices by Rs. 2 and Rs. 1 respectively. “The Chief Minister will sign an order paving the way for the same on Tuesday,” State Finance Minister Sudhir Mungantiwar told The Hindu on Monday.
He did not specify if the government will cut drought cess or other taxes. Around 18 months ago, the government had announced a special cess on petrol and diesel to fund relief works in drought-hit areas. In October 2015, a per litre surcharge of ₹2 was announced on petrol and diesel prices to tackle drought. In April 2017, this surcharge was increased by ₹3 on petrol.
Mr. Mungantiwar said the reduction in fuel prices will place a burden of ₹2,000 crore on the government.
The Central had recently cut excise duty on petrol and diesel, making prices cheaper by ₹2 each per litre. “This had reduced our revenue by ₹1,050 crore. In all, lowering of fuel prices will cost the State ₹3,050 crore.”
When asked if the government has enough resources to cover the losses, he said it being worked upon. “We are committed to farmers and citizen. We will ensure that the State has enough funds.”