Punjab sees biggest reduction in petrol price, Ladakh on diesel

Punjab has seen the most cut in petrol price of ₹16.02 a litre; while in Ladakh rate of diesel has come down by ₹9.52 per litre

November 14, 2021 06:05 pm | Updated 06:12 pm IST - New Delhi

Photo used for representational purpose only. Fuel pump attendants fill petrol at a fuel station after the State government announced a reduction in fuel prices, in Amritsar on November 8, 2021.

Photo used for representational purpose only. Fuel pump attendants fill petrol at a fuel station after the State government announced a reduction in fuel prices, in Amritsar on November 8, 2021.

Congress-ruled Punjab has seen the biggest reduction in price of petrol in the country after it cut local sales tax or VAT the most; while Union Territory of Ladakh witnessed the largest reduction in diesel rates for the same reason.

Post the Union government's decision of reducing excise duty on petrol by ₹5 per litre and that on diesel by ₹10 a litre, 25 States and U.T.s have cut VAT to give further reprieve to consumers battered by record-high retail prices.

Petrol price has been further reduced by as much as ₹16.02 per litre and diesel by ₹19.61 a litre as a result of combined impact of the excise duty and VAT cut, according to price charts available from state-owned fuel retailers.

Poll-bound Punjab has seen the most cut in petrol price of ₹16.02 a litre, followed by U.T. of Ladakh with ₹13.43 a litre and Karnataka (₹13.35).

The VAT reduction in Punjab is ₹11.27 per litre on petrol while in Uttar Pradesh, which will go to polls early next year to elect a new government in the State, the reduction is ₹6.96. Gujarat has seen ₹6.82 a litre reduction in VAT while Odisha has cut sales tax by ₹4.55 and by ₹3.21 in Bihar.

Diesel has seen the most reduction in Ladakh where rates have come down by ₹9.52 per litre because of a cut in VAT on top of ₹10 a litre fall in excise duty. Karnataka has cut VAT by ₹9.30, followed by ₹9.02 reduction in Puducherry.

Punjab has cut Value-Added Tax (VAT) on diesel by ₹6.77 a litre while Uttar Pradesh has cut the tax by the second lowest level of ₹2.04.

Uttarakhand has cut VAT on diesel by ₹2.04 a litre and Haryana by ₹2.04. Bihar has reduced VAT by ₹3.91 and Odisha by ₹5.69. Madhya Pradesh cut tax on diesel by ₹6.96 a litre.

The States/UTs that extended additional VAT benefits are Ladakh, Karnataka, Puducherry, Jammu & Kashmir, Sikkim, Mizoram, Himachal Pradesh, Daman & Diu, Dadra & Nagr Haveli, Chandigarh, Assam, Madhya Pradesh, Tripura, Gujarat, Nagaland, Punjab, Goa, Meghalaya, Odisha, Arunachal Pradesh, Manipur, Andaman & Nicobar, Bihar, Uttarakhand, Uttar Pradesh and Haryana.

States that have so far not lowered VAT include Congress and its allies ruled Rajasthan, Chhattisgarh, Maharashtra, Jharkhand and Tamil Nadu. AAP-ruled Delhi, TMC-governed West Bengal, Left-ruled Kerala, TRS-led Telangana and YSR Congress-ruled Andhra Pradesh have also not cut VAT.

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 was higher than ₹5 a litre cut in excise duty on petrol and ₹10 per litre cut in diesel. The reduction was larger in states with higher VAT.

In Delhi, the reduction in petrol price was ₹6.07 per litre, and that on diesel was ₹11.75, according to the price chart. Petrol costs ₹103.97 a litre and diesel is priced at ₹86.67 per litre.

There have been no changes in retail selling price since the excise duty cut was implemented from November 4.

After duty changes, the costliest petrol is sold in Rajasthan at ₹111.10 per litre (Jaipur), followed by Mumbai (₹109.98) and Andhra Pradesh (₹109.05). The fuel is below ₹100-a-litre-mark in most BJP-ruled states barring Karnataka (₹100.58), Bihar (₹105.90), Madhya Pradesh (₹107.23) and Ladakh (₹102.99).

Diesel is costliest in Rajasthan at ₹95.71 a litre, followed by Andhra Pradesh (₹95.18) and Telangana (₹94.62).

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