The Tripura government Thursday reduced value added tax (VAT) on cooking gas by two percent and withdrew entire four percent tax on kerosene with immediate effect.

Chief Minister Manik Sarkar told the state assembly that the government would consider another 0.5 percent tax reduction on cooking gas.

The state government, considering all aspects, has reduced VAT from four percent to two percent. Due to this tax cut, the authority would incur a loss of Rs.20 million annually, said Finance Minister Badal Chowdhury.

There would be no tax on kerosene oil in the state, he added.

The Tripura government June 6 reduced sales tax on petrol from 20 percent to 15 percent and on diesel to 10 percent from 12.5 percent.

After the reduction of taxes on the four petroleum products, the state would incur a cumulative loss of about Rs.100 million annually, Chowdhury added.

The state assembly also urged the central government to give subsidy on cooking gas for the eight northeastern states.

Considering the weak financial position and limited revenue support, the union government should not impose any additional burden and instead give special subsidy on cooking gas for the northeastern states, Sarkar said.

A resolution seeking concessions from the central government, adopted unanimously, was moved by the Communist Party of India-Marxist (CPI-M) legislator Sudhan Das. It was supported by the opposition Congress lawmakers in the assembly, whose three-week long budget session is now on.

On June 4, the central government increased the prices of petrol and diesel by Rs.5 and Rs.3 per litre and domestic LPG by Rs.50 per cylinder.