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Mumbai witnesses cuts in petrol and diesel prices due to VAT reduction
The Maharashtra government has announced a reduction in Value Added Tax (VAT) on fuel, effective from July 1, 2024, resulting in a slight reduction in petrol and diesel prices in Mumbai and neighboring areas. Deputy Chief Minister and Finance Minister Ajit Pawar revealed this decision during the presentation of the 2024 state Budget.
As part of the new measure, petrol prices will come down by 65 paise per litre, while diesel prices will see a reduction of Rs. 2.60 per litre. This VAT reduction will specifically apply to the municipal areas of Brihanmumbai, Thane and Navi Mumbai. The revised VAT on petrol will be 25 per cent plus an additional Rs. 5.12, down from the earlier 26 per cent plus Rs. 5.12.
Minister Pawar said the decision to reduce VAT is expected to cost the state exchequer Rs. 200 millions. He emphasized that the government intends to provide some relief to residents amid fluctuating fuel prices.
This announcement comes close on the heels of the states of Karnataka and Goa increasing their fuel prices earlier this month. The Goa government increased VAT to 21.5 per cent on petrol and 17.5 per cent on diesel, resulting in a price hike of Rs. 1 per litre for petrol and 36 paise for diesel. Similarly, Karnataka saw a hike of Rs. 3 per litre for petrol and Rs. 3.5 per litre for diesel, following an increase in sales tax to 29.84 per cent for petrol and 18.44 per cent for diesel.
The Maharashtra government’s decision to reduce fuel prices stands in contrast to these recent hikes in neighboring states, aimed at easing the financial burden on consumers in the Mumbai metropolitan region.
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