Finance Minister Arun Jaitley today announced a cut of Rs 1.50 in excise duty for petrol and diesel.

Addressing a press conference in New Delhi, Jaitley said that the oil companies would further cut the fuel rates by Rs. 1, which means that petrol and diesel are set to get cheaper by Rs 2.50.

The new rates will be applicable from midnight.Union Finance appealed state governments to follow suit and reduce their tax on petroleum products by Rs 2.50.

Arun aitley said that after reduction in  fuel rates consumers can get a relief of at least Rs 5 in petrol and diesel per litre.

Arun Jaitley said that he expects to see a negative revenue impact of Rs 10,500 crore as a result of the tax cuts and said that he expected that the government would be able to absorb the impact without harming its fiscal deficit target of 3.3%.