Petrol, diesel to become cheaper in Mumbai, Thane and Navi Mumbai; here's why

Fuel prices are set to come down in Maharashtra, as the state government has decided to reduce the value-added tax (VAT) levied on the retail sale of petrol and diesel.

The announcement was made by Deputy Chief Minister Ajit Pawar, while presenting the state budget for fiscal year 2024-25 in the legislative assembly on Friday, June 28.

In Mumbai, Thane and Navi Mumbai, the VAT on diesel will be slashed to 21% from 24% at present, Pawar said. On petrol, the VAT will be reduced to 25% from 26%, he added.

This will bring down the rate of diesel by around ₹2.60 per litre, whereas, petrol prices will come down by around 65 paise a litre. The new rates will come into effect from July 1.

The decision will be applicable only in Mumbai, the state capital, and the neighbouring cities of Navi Mumbai and Thane, Pawar clarified. The prelevant rate of VAT on fuel will continue in other parts of Maharashtra.

The reduction of tax on fuel in the three cities will cost the state exchequer ₹200 crore, Pawar said.

Present fuel rates

Petrol is currently priced at ₹104.21 per litre in Mumbai, whereas it charged at ₹104.35 per litre in Thane and Navi Mumbai.

Diesel is presently charged at ₹92.15 per litre in Mumbai, and ₹92.34 per litre in Thane and Navi Mumbai.

Chief Minister Eknath Shinde, while commenting on the decision to slash the VAT, said, "The VAT cut has been proposed in the budget. Once the budget is passed by the state legislative assembly and the council, the decision will come into effect from July 1."