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The petrol and diesel prices have been reduced by Rs 2.50/ litre as the government announced a reduction in the excise duty by Rs 1.50 per litre. The government also asked the oil companies to reduce Rs 1/ litre which brings the total reduction to Rs 2.50/litre. The new fuel prices will be effective from October 5, 2018.
The petrol and diesel price in Gujarat and Maharashtra has been reduced by Rs 5/litre as the state governments reduced the sales tax and VAT. The reduction in the excise duty will lead to a loss of revenue by Rs 10,500 crore to the government but with the prices reaching an all-time high some measures had to be taken.
In the national capital Delhi, the petrol price stands at Rs 81.51/ litre and diesel costs Rs 72.95/litre after the price reduction. But states such as Karnataka and Kerala have not reduced the VAT. Karnataka had previously reduced the petrol and diesel prices by Rs 2/litre.
After announcing the reduction in excise duty, Finance Minister Arun Jaitley said that the total impact of the cut in excise duty will be Rs 21,000 crore for the full year. Commenting on oil companies absorbing Rs 1/ litre, Jaitley said that they would adjust it over the present and future fuel prices.
The petrol and diesel prices had hit an all-time high in many states and the petrol price had crossed Rs 91/litre in Mumbai. The fuel stations were also getting ready to display three-digit fuel prices by upgrading the fuel dispensers. But finally, the latest price reduction brings some relief to the consumers.
Thoughts On The Petrol And Diesel Price Reduction
The Government of India has finally reduced the excise duty on petrol and diesel and has asked the oil companies to absorb the additional Rs 1/litre. The government has also informed the state governments to reduce the local tax. Some states have gone ahead and reduced the VAT but some states have ignored the request.