Jaipur, Mar 14 (IANS): The Rajasthan government on Thursday announced the reduction of Value Added Tax (VAT) on petrol and diesel by 2 per cent.

The Bhajan Lal Sharma-led government has also hiked the Dearness Allowance (DA) for state government employees by 4 per cent.

The decisions were taken during the second meeting of the Cabinet led by Chief Minister Sharma on Thursday.

"Till now, the rates of petrol and diesel varied in the different districts of Rajasthan. The government has now removed this discrepancy, ensuring that the same rates are applied in all the districts of the state," CM Sharma said.

He also said that the reduced prices will come into effect from 6 a.m. on Friday. The move will put an additional burden of Rs 1,500 crore on the state exchequer.

To recall, on March 10 and 11, petrol dealers in the state went on strike demanding a reduction in VAT.

Meanwhile, the Rajasthan government has also hiked the Dearness Allowance (DA) for all state government employees by 4 per cent, from 46 per cent to 50 per cent. This will put an additional burden of Rs 1,639 crore on the state exchequer.

The move followed after the Union Cabinet recently approved to release an additional instalment of Dearness Allowance to the Central government employees and Dearness Relief (DR) to the pensioners from January 1, 2024, representing an increase of 4 percentage points over the existing rate of 46 per cent.