Petrol, Diesel prices: Government hikes excise duty by up to Rs 13; will it hit consumers?
Government has decided to increase the excise duty on petrol and diesel, in a bid to generate more revenue However, you will not have to pay more at the fuel station. Late on Tuesday evening, the government hiked excise duty on petrol by Rs 10 per litre and that on diesel by Rs 13 a litre.
Government has decided to increase the excise duty on petrol and diesel, in a bid to generate more revenue However, you will not have to pay more at the fuel station. Late on Tuesday evening, the government hiked excise duty on petrol by Rs 10 per litre and that on diesel by Rs 13 a litre to mop up gains arising from international oil prices falling to a two-decade low. The latest move is expected to help government generate close to Rs 1.6 lakh crore in additional revenues this fiscal from a record increase in excise duty on petrol and diesel.
This is the second hike in excise duty in less than two months and will help government garner over Rs 1.7 lakh crore in additional revenues annually at 2019-20 level of consumption.
Together with Rs 39,000 crore in annual revenues gained from the March 14 excise duty hike of Rs 3 per litre each on petrol and diesel, the government stands to gain as much as Rs 2 lakh crore.
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There was no immediate impact on petrol and diesel prices with state-run oil marketing companies (OMCs) on Wednesday (May 6) leaving the retail price unchanged. The price increase will be absorbed by OMCs leading to no hike in pump prices of auto fuels.
In Delhi, petrol is being retailed at Rs 71,26 a litre, diesel, on the other hand, is being sold at 69.39 per litre, no change in prices against Tuesday’s rates. Local prices of petrol and diesel in Mumbai are static at Rs 76.31 a litre and Rs 66.21, respectively. People in Kolkata will have to shell out Rs 73.30 for a litre of petrol. Diesel price is static at Rs 65.62, as per data available with Indian Oil Corp website.
In Chennai, the petrol price remained unchanged at Rs 75.54 a litre and diesel costs Rs 68.22 (unchanged) per litre.
Central excise duty makes up for 46 per cent of petrol and diesel price now. After considering local sales tax or VAT, the total tax incidence in the price is as high as 60 per cent. The excise tax on petrol was Rs 9.48 per litre when the Modi government took office in 2014 and that on diesel was Rs 3.56 a litre.
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