Petrol, Diesel Prices Unchanged; Nagaland Becomes 5th State To Cut Rates

Fuel prices in India were unchanged for the second straight day on Thursday by state-owned oil marketing companies.

Petrol prices per litre remained at Rs 90.93 in New Delhi, Rs 91.12 in Kolkata, Rs 97.34 in Mumbai and Rs 92.97 in Chennai.

Diesel prices per litre were unchanged at Rs 81.32 in New Delhi, Rs 84.20 in Kolkata, Rs 88.44 in Mumbai and Rs 86.37 in Chennai.

These rates are revised on a daily basis by oil marketing companies in line with changes in the international prices and the rupee's exchange rate. However, the difference in retail prices of fuel across states is due to local, state and central government taxes on petrol and diesel. A large percentage, that is up to 60%, of the retail price on petrol or diesel price paid by consumers in the country is just a form of central, state or local tax.

To reduce the burden on consumers, on Wednesday, Nagaland became the fifth state to cut taxes after the recent rally rates that have pushed prices to new highs.

The state finance department said the tax rate for diesel has been reduced from Rs 11.08 to Rs 10.51 per litre or 17.50% to 16.50% per litre (whichever is higher) while the tax on petrol and other motor spirits has been reduced from Rs 18.26 to Rs 16.04 per litre or 29.80% to 25% per litre (whichever is higher). The reduction in fuel tax came into effect on 22 February. With this change, the retail price of petrol and diesel per litre in Nagaland came down to Rs 90.41 and Rs 83.99.

In the last two weeks, four other states, namely West Bengal, Rajasthan, Assam, and Meghalaya, have taken the initiative of reducing the burden on consumers by lowering state-related taxes on fuel.