Petrol and diesel will be cheaper by Rs 5 per litre in Madhya Pradesh from midnight as the central and the state governments on Thursday announced reduction by Rs 2.50 each.
The state government made the announcement to reduce the prices by Rs 2.50 per litre after the centre's decision to cut the fuel prices by equal amount.
"I had a discussion over phone with the Chief Minister Shivraj Singh Chouhan after the centre announced cut in tax on petrol and diesel and decided to provide matching relief to the people (of the state) by reducing VAT," Madhya Pradesh Finance Minister Jayant Mallaiyya told PTI.
He said the chief miniser was in Sehore district and he himself was in some rural area "but we managed to connect".
"Both petrol and diesel are now cheaper by Rs 5 in Madhya Pradesh from midnight Thursday," Mr Mallaiyya added.
Earlier, Arun Jaitley announced in Delhi a cut in petrol and diesel prices by Rs 2.50 per litre, factoring in excise duty reduction of Rs 1.50 per litre.
He asked state governments to follow suit by cutting a sales tax or VAT by a similar amount.
The reduction followed petrol and diesel prices touching new highs.