VAT effect: Petrol price up, diesel down in city

Petrol and diesel prices were on Wednesday cut by Rs 2 per litre, excluding local levies, in the second reduction of rates this month by oil companies, but the petrol would actually become costlier in the 

national capital due to an increase in VAT rate here.

The decrease in diesel prices would also be less in Delhi due to a hike in Value Added Tax (VAT) by Arvind Kejriwal-led Aam Aadmi Party government. The new rates announced by the oil marketing companies will be effective from midnight tonight.

While, the reduction in petrol and diesel prices was reflective of local trends, the consumers in Delhi will not be able to get the benefit as the Arvind Kejriwal government raised VAT on the two fuels robbing city customers of the reduction.

While the rates will reduce by a bigger number all over the country, petrol price in Delhi will go up by 28 paise a litre after considering local government’s decision to hike VAT or sales tax on the fuel from 20 to 25 per cent.

Petrol in Delhi will cost Rs 66.90 per litre from tomorrow instead of Rs 66.62 at present. A litre of diesel will cost Rs 49.72 per litre as against Rs 50.22 earlier, Indian Oil Corp (IOC), the nation’s largest oil company, said.