MUMBAI: A day after the Centre reduced the excise duty on petrol and diesel by ₹8 and ₹6, respectively, the price of petrol dropped by ₹9.16 and that of diesel by ₹7.49 in Mumbai. The petrol was available at ₹111.35 a litre while the diesel was priced at ₹97.28 per litre. The fuel rates in Maharashtra are still high compared to neighbouring states, especially the BJP-ruled states.
Even as the excise duty was slashed on petrol and diesel, Mumbai continued to have the costliest petrol among metro cities at ₹111.35 a litre followed by Hyderabad at ₹109.66 a litre and ₹106.03 a litre in Kolkata. Diesel was costliest in Hyderabad with ₹97.82 a litre followed by Mumbai with ₹97.28 and Chennai with ₹94.24 a litre.
Further, despite the reduction in petrol and diesel prices dealers have stated that the fuel prices are costlier than neighbouring states. Petrol and diesel cost ₹96.42 and ₹92.17 in Ahmedabad, ₹108.65 and ₹93.90 in Bhopal, ₹109.66 and ₹97.82 in Hyderabad, ₹97.68 and ₹90.23 in Panjim.
This is because the Maharashtra government has not reduced Value Added Tax (VAT) on petrol and diesel whereas the neighbouring states had earlier slashed VAT when the Centre had reduced its excised on November 4 last year, resulting in a drop in fuel prices in these states.
Though the Maharashtra government issued a statement on Sunday stating it had reduced the VAT by ₹2.08 on petrol and ₹1.44 on diesel, the reduction was reflected naturally because of the adveloram system of taxation. “The reduction in the VAT is the natural reduction reflected because of the reduction in the central excise. It will lead to the annual losses of ₹2,500 crore to the state exchequer,” said Manoj Saunik, additional chief secretary, finance department.
Petrol dealers have stated that they have been suffering losses owing to the no reduction in VAT as the consumers residing nearby state borders are travelling to other states for fuel.
“Maharashtra government has not reduced VAT till now that has resulted in losses of petrol dealers across the borders. People are travelling to other states and filling up their vehicle tanks,” said Uday Lodh, president, Federation of Maharashtra Petrol Dealers Association.
Transporters body have stated that they are awaiting for Maharashtra Government to reduce VAT immediately.
“We have been long expecting a reduction in state taxes since the last excise reduction announced by the Centre in November last year,” said Bal Malkit Singh, chairman, All India Motor Transport Congress (AIMTC).
Citizens have also urged the state government to reduce taxes. “Mumbai has the costliest fuel than any other metro city. The state government did not reduce VAT last time after the excise duty was slashed as well. They should consider the plight of consumers and reduce VAT on petrol and diesel immediately,” said Chetna Sinha, an Andheri resident.