Petroleum fuel falls from a hand pump at a gas station operated by Bashneft PAO in Ufa, Russia. (Photographer: Andrey Rudakov/Bloomberg)

After Rajasthan, Andhra Pradesh Cuts Value Added Tax On Petrol, Diesel

The Andhra Pradesh government today announced a Rs 2 per litre cut in value added tax on petrol and diesel to check the rising prices. The price of petrol is expected to come down to Rs 84.71 a litre and diesel Rs 77.98 from Tuesday morning when the tax cut comes into effect.

The state government was levying Rs 4 a litre value added tax on petrol and diesel, Chief Minister N Chandrababu Naidu told the state assembly. “The central government has been imposing a heavy burden on people by steeply increasing the prices of petrol and diesel despite heavy income in the form of various levies and dividends.”

Though the state is faced with a deficit budget, we have decided to reduce the tax and ease the burden on people. The state would have to forego a revenue of Rs 1,120 crore due to the measure.
N Chandrababu Naidu, Chief Minister, Andhra Pradesh 
The state government is currently levying 31 percent Value Added Tax plus Rs 4 as additional tax per litre of petrol and diesel. The additional tax component is now being reduced to Rs 2 a litre, a senior official of the Commercial Taxes Department said separately.

A day before the opposition-sponsored Bharat Bandh against rising fuel prices, poll-bound Rajasthan slashed the value added tax on petrol and diesel. Chief Minister Vasundhara Raje announced a 4 percent reduction which brought the prices of the two commodities down by Rs 2.5 per litre.

Also read: Government Rules Out Excise Duty Cut As Fuel Prices Hit Fresh High