The Gujarat Government on Wednesday announced reduction in petrol and diesel prices by Rs 2.50 per litre to match the announcement made by the Union Finance Minister, Arun Jaitley, amid rising crude prices.

Immediately after the Finance Minister's announcement, Gujarat Chief Minister Vijay Rupani announced in a Twitter post saying, "..reciprocating positively to FM’s announcement, the Govt of Gujarat has also decided to reduce Rs.2.50 on both petrol & diesel. Thus petrol & diesel wd be Rs. 5 cheaper in the State of Gujarat."

Addressing a press conference in Gandhinagar, the Deputy Chief Minister, Nitin Patel, said that the State has decided to reduce the value-added tax (VAT) on auto fuel.

"The reduction in VAT rates will be made effective today or latest by tomorrow morning. We had earlier reduced VAT by 4 per cent in 2017. Currently, there is 20 per cent VAT on petrol, which will be worked out to make Rs 2.50 reduction effective," Patel said, adding that with the reduced VAT rates, the State will incur a loss of Rs 1,500-2,000 crore.

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