Since July 2021 for the first time the prices of petrol is below Rs. 100 in fifteen states, and three Union Territories. Incidentally, all 15 states are ruled by the BJP and its allies except for Odisha, no other non-BJP-ruled state or UT has slashed fuel prices yet.
Overall, 23 states and UTs have undertaken a commensurate reduction of Value Added Tax (VAT) on petrol and diesel to give relief to consumers. Karnataka, Bihar, and Madhya Pradesh are the only BJP-ruled states where petrol still costs more than Rs 100 despite heavy cuts by the Centre and state. Petrol in the UT of Ladakh is also being sold at more than Rs 100.
A day ahead of Diwali, the Centre announced rate cuts on petrol and diesel prices. With this move, the central levy on petrol and diesel was cut by Rs 5 and Rs 10.
Fuel prices had touched the Rs 100-mark at the beginning of the second week of July almost everywhere in the country. Petrol was a little over Rs 69 per litre in April 2020 and had touched over Rs 90 at the end of March this year.
Following the Centre’s move, 16 states and seven Union Territories announced commensurate cuts in VAT, while 12 states and 1 UT desisted from making a move.
The states/UTs which are selling petrol below Rs 100 are Uttar Pradesh, Uttarakhand, Gujarat, Haryana, Assam, Chandigarh, Goa, Himachal Pradesh, Jammu and Kashmir, Sikkim, Arunachal Pradesh, Mizoram, Nagaland, Tripura and Puducherry.
The states/UTs which have not undertaken any reduction in VAT on petrol and diesel are Maharashtra, Delhi, West Bengal, Tamil Nadu, Telangana, Andhra Pradesh, Kerala, Meghalaya, Jharkhand, Chhattisgarh, Punjab, Rajasthan and Andaman and Nicobar. All these states are ruled by non-BJP parties.
In fact, Odisha is the only opposition-ruled state that has announced a VAT reduction of Rs 3 per litre on both petrol and diesel.
With this distinction, the BJP and its allies in NDA are expected to extract political mileage.