New Delhi : Petrol price on Thursday was cut by Rs 6.07 per litre and diesel price by Rs 11.75 in Delhi as oil companies passed on a record reduction in excise duty rates to consumers.
Buckling under pressure, the government had on Wednesday cut excise duty on petrol by Rs 5 per litre and that on diesel by Rs 10 a litre to give reprieve to consumers battered by record high retail fuel prices. Since states charge local sales tax or VAT not just on the base price but also on the excise duty levied by the centre, the total incidence of price reduction is higher.
Petrol will cost Rs 103.97 per litre in Delhi against Rs 110.04 per litre, according to a price notification of state-owned fuel retailers.
Diesel rates accordingly will reduce to Rs 86.67 per litre from Rs 98.42 per litre.
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In Mumbai, petrol price has been cut by Rs 5.87 to Rs 109.98 per litre and diesel by Rs 12.48 to Rs 94.14 per litre. Kolkata saw the price of diesel being reduced by Rs 5.82 to Rs 104.67 per litre and that of diesel by Rs 11.77 to Rs 89.79 per litre.
Petrol price in Chennai has been reduced by Rs 5.26 to Rs 101.40 per litre and diesel by Rs 11.16 to Rs 91.43 per litre.
VAT rates differ from state to state, leading to differential rates of fuel.
The excise duty cut announced on Wednesday night is the highest-ever reduction in excise duty. It rolls back a part of the Rs 13 and Rs 16 per litre increase in taxes on petrol and diesel effected between March 2020 and May 2020 to avoid passing on to consumers the sharp fall in international oil prices.
The hike in excise duty had taken central taxes on petrol to their highest level of Rs 32.90 per litre and that on diesel to Rs 31.80 a litre.
Reducing the excise duty, the Union government also urged states to commensurately reduce VAT on petrol and diesel to give relief to consumers. Six BJP-ruled states of Uttar Pradesh, Goa, Karnataka, Uttarakhand, Tripura and Bihar reduced VAT.