New Delhi July 30 In a major relief to fuel consumers in the national capital, the Delhi government on Thursday reduced VAT on diesel from 30 per cent to 16.75 per cent, making the transport fuel cheaper by Rs 8.36 per litre.
With this, pump price of diesel will now come down to Rs 73.64 a litre from the existing level of Rs 81.94 a litre. Petrol however will continue to be priced at Rs 80.43 a litre as there is no change in state taxes on it. The price change would be reflected from Friday when retail prices are revised by oil marketing companies.
Briefing about the decision in a Press Conference, Chief Minister said, "We were receiving demands from many sectors in Delhi to reduce the VAT on diesel. This cut will strengthen the economy in Delhi."
The proposal for reduction in VAT was passed in the cabinet meeting on Thursday.
Delhi was the only major city in the country where diesel prices were higher than that of petrol. While diesel is priced at Rs 81.94 a litre here, petrol is holding back the same price since June 29 at 80.43 a litre.
Delhi Petroleum Dealers Association (DPDA) has welcomed the Delhi government's decision to reduce VAT on diesel. DPDA is a body of petrol pumps owners in Delhi with membership of about 400 fuel pumps.
Anil Bijlani, president of DPDA told , "Delhi Government had increased Value Added Tax (VAT) on diesel to 30 per cent from 16.75 per cent on May 5. This increase in VAT had resulted in a price difference of more than Rs 8/litre in diesel with neighbouring states, which was causing a heavy loss of sales. We had approached Delhi government many times and asked them to reduce VAT on fuel prices."
Bijlani told that new prices will be applicable from 6 a.m. on Friday. He said, "We are expecting our business to return to normal after this reduction in next 2-3 months."
Arvind Kejriwal also urged people to return to their work and restart factories and shops which were closed during the lockdown. He said, "Our government is making every effort to bring the economy back on track. The job portal, we have started is receiving a tremendous response. So far 2,04,785 jobs have been listed on the portal and 3,22,865 job seekers have applied on the portal".
Kejriwal said he will start meeting traders and businessmen of Delhi in coming days.
( With inputs from IANS )