Inflation-hit Delhiites can breathe a little easy with Delhi Government today slashing the value added tax (VAT) on diesel to 12.5 per cent from the existing 20 per cent which would bring down the fuel prices by Rs 2.70 per litre to Rs 37.50 per litre in the city.

The decision to decrease VAT on diesel from 20 per cent to 12.5 per cent was taken at a cabinet meeting today presided over by Chief Minister Sheila Dikshit.

Later talking to reporters, she said that the rate has been reduced as Delhi government was losing on revenue from diesel after it increased VAT on it in last budget.

“People were preferring to go to the neighbouring states like Haryana and UP to purchase diesel. That is why we have decided to cut down the VAT by 8 per cent,” Dikshit said.

Delhiites were shelling out Rs 40.

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