Shillong: Meghalaya government on Tuesday slashed retail prices of petrol and diesel by another over Rs 5 by reducing VAT on them, Chief Minister Conrad K Sangma said.
The decision came amid a strike by commercial transporters that entered the second day on Tuesday.
The new retail price of petrol will be Rs 85.86 from its current price of Rs 91.26, while the new retail price of diesel will be Rs 79.13 from its present rate of Rs 86.23 in the state capital, Sangma said after a review meeting he held with his cabinet colleagues and senior government officials.
He said the total reduction will be Rs 7.4 for petrol and Rs 7.1 for diesel after the state government had announced a Rs 2 rebate on both the items last week.
The lowering of prices of both petrol and diesel was a result of the state governments decision to reduce the VAT from 31.62 per cent on petrol to 20 per cent per litre or Rs 15 per litre (whichever is higher).
For diesel VAT came down from 22.95 per cent to 12 per cent or Rs 9 per litre, Conrad said.
The chief minister said the new tariff will also ensure a competitive pricing of both the items with the neighbouring Assam which had reduced the prices of both petrol and diesel by Rs 5 last week.
The decision is likely to pacify agitating commercial transporters who had remained off the road in the past two days and also threatened to go on indefinite hunger strike if the government fails to act.
The state government had collected Rs 326 crore as revenue from taxes on petrol and diesel in the last financial year.
Conrad said the government had already collected Rs 451 crore by way of taxes on petrol and diesel till January this year.
(With inputs from PTI)