Chhattisgarh: In a bid to ease the fuel prices further, the Chhattisgarh Government today announced a 2 per cent reduction in value-added tax (VAT) on diesel price and 1 per cent cut on petrol rate. The announcements were tweeted on Monday via the official handle of the Chief Minister’s Office (CMO) Chhattisgarh. Chhattisgarh CMO tweeted, “The govt will incur a loss of around Rs 1,000 crores.”
With this, Chhattisgarh has joined a list of states that announced a cut in VAT after the central government had decided to cut Central Excise Duty on petrol and diesel to provide a relief to consumers reeling under steep fuel rates hike.
According to IANS, since January 1, petrol and diesel prices have risen by more than Rs 26 a litre before the duty was cut by the central government on Diwali eve, on November 3. The duty cut by the central government, according to media reports, was first such exercise since the onset of Covid pandemic.
Before the cut was announced, the excise duty was standing at Rs 31.8 on diesel and Rs 32.9 on petrol. To mobilise the resources for Covid relief measures, the excise duty was raised by Rs 13 per litre on petrol and Rs 16 per litre on diesel between March 2020 and May 2020, according to IANS.
However, for the last 18 days, the retail prices of petrol and diesel have remained static. According to media reports, the global crude prices have softened to USD 75 per barrel from a three-year high of USD 85 per barrel. The rise in US inventory has helped the crude oil prices to come down.
On Monday, November 22, petrol price in Delhi stood at Rs 103.97 a litre. The diesel costed Rs 86.67 a litre in the capital. Whereas, in the financial capital Mumbai, petrol costed Rs 109.98 a litre and diesel costed Rs 94.14 a litre.
After the cut was announced by central government, various states government have reduced VAT on petrol and diesel. Chhattisgarh is the latest state to reduce the duty.