Bhubaneswar: In order to provide relief to general public from the rising fuel prices, Odisha chief minister Naveen patnaik Thursday announced reduction of Vat of Rs 3/each on petrol and diesel which will be applicable from midnight of 5th Nov .
This is over and above the reduction in excise duty announced by Government of India
In view of this reduction, the loss of VAT revenue to state exchequer will be to the tune of Rs 1400 crore per annum. This is in addition to loss in VAT collection @ Rs. 1.6/ litre on petrol and Rs. 2.8/ litre on diesel, total amounting to Rs 700 Cr., which the state is likely to incur in view of Excise duty reduction by Government of India.
Hence the total loss to state exchequer on account of reduction in VAT is approximately Rs. 2000 Cr. but is going as a major relief to the people of Odisha.
With this reduction, the petrol & diesel prices in the state is likely to be one of the lowest in the country.