Fuel Becomes Cheaper: Modi Government Slashes Price By Rs 2.50 Per Litre, Asks States To Do The Same

The Union Government on Thursday (4 October) announced a cut of Rs 2.50 per litre on Petrol and Diesel with immediate effect, reports Times of India.

Finance Minister Arun Jaitley while speaking at a press conference said that the government would effect a Rs 1.50 cut on excise duty on petrol and diesel. Apart from that the government is also reported to have asked the oil marketing companies (OMC) to absorb a deduction of Re 1 on both petrol and diesel.

He also urged states to take a cut in sales tax or VAT on fuel. The excise duty cut will cost the centre Rs 10,500 crore, he added. Taxes on petrol and diesel is one of the biggest source of revenue for the government comprises of about one-third of the cost.

Soon after Jaitley announced the price cuts, Chief Minister of Maharashtra cut Rs 2.50 in fuel prices, Gujarat government also effected a similar cut.

Chief ministers Devendra Fadnavis and Vijay Rupani tweeted their thanks to PM Modi.

Jaitley while announcing the price cuts also said that he would be writing to the state governments to cut the state sales tax or VAT to further bring down the prices by Rs 2.50.