Rajasthan Government Slashes Fuel Prices, But Faces Revenue Crunch

In a move aimed at rectifying the disparities in petrol and diesel prices across various cities in Rajasthan, Chief Minister Bhajan Lal Sharma announced a significant reduction in fuel rates. The decision, accompanied by a 2 percent reduction in VAT, is expected to provide relief to consumers while posing challenges for the state’s revenue management.

CM Bhajan Lal Sharma, the Chief Minister of Rajasthan, announced on Thursday that his government has resolved the anomaly of different petrol and diesel rates in different cities of the state. In districts where the fuel prices were higher, significant reductions were made, while in districts with lower rates, the price cuts were less substantial.

Additionally, the state government reduced VAT by 2 percent, in line with the 2 percent reduction in petrol and diesel prices by the central government. As a result, petrol and diesel became available at cheaper rates in Rajasthan from Friday morning. However, this move will lead to a decrease in the state government’s income by approximately Rs 1,500 crore.

In an effort to create uniformity in fuel prices across the state, CM Bhajan Lal Sharma took the decision to address the disparity in rates.

This move is expected to benefit the consumers, especially in districts where the fuel prices were previously higher. The reduction in VAT by 2 percent further contributed to the decrease in prices, making fuel more affordable for the people of Rajasthan.

While this decision brings relief to the consumers, it will also have an impact on the state government’s revenue. CM Bhajan Lal Sharma acknowledged that the decrease in petrol and diesel prices will lead to a decrease in the state government’s income by Rs 1,500 crore. This loss in revenue may pose challenges for the government in terms of budgeting and funding various developmental projects and initiatives.

Overall, this decision by CM Bhajan Lal Sharma to remove the anomaly in petrol and diesel rates in Rajasthan is aimed at ensuring fairness and affordability for the consumers. However, the decrease in the state government’s income highlights the need for efficient financial management and alternative sources of revenue generation to sustain the development and welfare programs in the state.

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