Insight Bureau: After the Centre reduced Excise Duty on petrol and diesel by Rs 5 and Rs 10 respectively, Odisha CM Naveen Patnaik has announced the reduction of VAT on petrol and diesel by Rs 3 per litre with effect from midnight of 5th November.

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 Crore, which the state is likely to incur in view of Excise duty reduction by Government of India,” said CM’s office.

“The total loss to state exchequer on account of reduction in VAT is approximately Rs. 2000 Crore, but is going as a major relief to the people of Odisha,” as per the CMO.

With this reduction, the petrol & diesel prices in the state is likely to be one of the lowest in the country.