Odisha Chief Minister Naveen Patnaik on Thursday announced reduction of Value Added Tax (VAT) of ₹3 each on petrol and diesel, which will be applicable from midnight of November 5.
In order to provide relief to general public from the rising fuel prices, the decision was taken, said the State government in a statement here. The reduction of ₹3 is over and above the decrease in excise duty announced by Centre.
“In view of this reduction, the loss of VAT revenue to State exchequer will be to the tune of ₹1,400 crore per annum. This is in addition to loss in VAT collection at ₹1.6 litre on petrol and ₹2.8 litre on diesel, total amounting to ₹700 crore, which the State is likely to incur in view of excise duty reduction by Centre,” the government said.
According to government estimate, the total loss to State exchequer on account of reduction in VAT is approximately ₹2,000 crore, but is going as a major relief to the people of Odisha.
“With this reduction, the petrol and diesel prices in the State are likely to be one of the lowest in the country,” claimed the Biju Janata Dal government.
