NEW DELHI: The AAP government on Wednesday slashed VAT (value added tax) on petrol from 30% to 19.4%, marking the steepest-ever tax reduction on the fuel that will reduce pump price by Rs 8.56 per litre from Thursday and stop flight of business to neighbouring UP and Haryana.
The reduction in VAT on petrol will bring down the fuel’s cost to Rs 95.41 per litre in the capital from Rs 103.97, provided the pump prices remain unchanged as they have been for the last 28 days. The AAP government had on May 5, 2020 raised VAT on petrol by 3% to 30% with a view to raise revenue for funding measures against Covid-19.
The revised petrol price in Delhi will be cheaper by 10 paise a litre than Noida and 15 paise than Gurugram and Rs 1.21 than Faridabad. But it will be costlier by 12 paise than Ghaziabad. The prices in these neighbouring townships differ due to difference in freight charges.
