The Gujarat Government on June 10, declared reduction of VAT on diesel and petrol by 3 per cent each and abolished the total VAT of 4 per cent on domestic LPG, thus bringing down prices of these products by Re 1 and Rs 1.38 per litre, respectively, and Rs 13.05 a gas cylinder. Due to these measures, the total affect of revenue loss to the State Government will be Rs 1,450 crore. With the Union Government declaring a price increase recently, the diesel prices had increased by Rs 3.55 in Gujarat. The retail price of diesel in the State will now be down by Re 1/litre. The petrol price had increased by Rs 5.49, which will now be down by Rs.1.38/litre.
The State Government hopes the oil marketing companies of the Centre to pass on this benefit to the consumers with immediate effect. The loss on this account to Gujarat will be Rs 50 crore. Apart from this, the additional burden on the State Government, as a consumer in terms of increased expenditure in development works, comes to Rs 455 crore. Thus, the total affect of the price increase of petroleum products by the Centre and relief given by the State Government, the impact on the exchequer will be to the extent of Rs 1,450 crore, whereas the total impact of price rise on the State''s people would be nearly Rs 3,000 crore.
The State Government hopes the oil marketing companies of the Centre to pass on this benefit to the consumers with immediate effect. The loss on this account to Gujarat will be Rs 50 crore. Apart from this, the additional burden on the State Government, as a consumer in terms of increased expenditure in development works, comes to Rs 455 crore. Thus, the total affect of the price increase of petroleum products by the Centre and relief given by the State Government, the impact on the exchequer will be to the extent of Rs 1,450 crore, whereas the total impact of price rise on the State''s people would be nearly Rs 3,000 crore.
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