A litre of petrol will cost Rs. 1.38 less in Tamil Nadu.

This follows the State government's decision to bring down the rate of sales tax on petrol from 30 per cent to 27 per cent.

Announcing this, Chief Minister M. Karunanidhi, in a statement, said the revised rate would be the lowest in southern States.

A senior official says that in Andhra Pradesh, the rate of ST on petrol is 33 per cent; in Kerala, 29 per cent ST and one per cent cess and in Karnataka, 25 per cent ST and five per cent entry tax.

The release stated that the latest move of the State government would cause an annual loss of revenue to the tune of Rs. 210 crore.

This had been done to ensure that the middle class, particularly users of two-wheelers, was not affected much in the wake of the increasing price of petrol.

The release recalled that the State government lowered the rate of ST on diesel from 25 per cent to 23.43 per cent in June 2006 and from 23.43 per cent to 21.43 per cent two years later.