In a bid to offer some relief to the common man, Tamil Nadu Chief Minister J.Jayalalithaa Tuesday ordered abolition of value added tax (VAT) on the cooking gas, bringing down its price by Rs.15 per cylinder.
In a statement issued here, the state government said it was waiving the four percent VAT on cooking gas from July onwards making the fuel cheaper by around Rs.15 per cylinder of 14.4 kg.
After the recent hike in fuel prices, cooking gas cost Rs.404 in the state. With the abolition of VAT, it will cost around Rs.390 for households.
The state government will be forgoing around Rs.120 crore in value added tax revenue due to this move.
Jayalalithaa had described as a joke the central governments advice to states to reduce VAT on cooking gas after hiking its price exhorbitantly by Rs.50 a cylinder.
Condemning the price hike, Jayalalithaa had said the move would have a cascading effect and result in all-round price increase.
She said the state government decided to abolish VAT as there is no sign of the central government rolling back the price hike.