Why are petrol and diesel costlier in some states than others?

Petrol and diesel prices vary across states due to different rates of VAT and additional local cesses levied by different state governments. States imposing highest VAT rates have reportedly pushed petrol prices well above national average. Centre said petrol prices have crossed ₹112/litre in Telangana and Kerala, while BJP-ruled states like UP and Delhi have rates at or below ₹102/litre.