Excise Duty on Petrol & Diesel: This year, petrol and diesel prices are at record levels across the country. This is the first time when normal petrol is being sold beyond Rs 100 per liter in a city. Petrol in Delhi has crossed Rs 91 and diesel Rs 81 per liter for the first time. In such a situation, inflation is being hit on the common man. Experts believe that there is scope for the government to cut excise duty on petrol and diesel by Rs 8.50 per liter. This can be cut without affecting the revenue generated by these fuels.
Revenue will not be affected
Experts of ICICI Securities say that the government has set a target of generating 3.2 lakh crore revenue from tax on petrol and diesel for the financial year 2021-22 in the budget. At the same time, according to the tax now, the government will collect Rs 4.35 lakh crore from excise duty on petrol and diesel. In such a situation, if the government cuts the import duty on petrol and diesel by Rs 8.50 per liter, then there will be no effect on its revenue target. It will remain Rs 3.2 lakh crore, but the common people will get a big relief from it.
Expected to cut excise duty
ICICI Securities has expressed the hope that excise duty cuts are expected amid improvement in demand, promotion of privatization and rising concerns about inflation. But this deduction can be less than Rs 8.5 per liter. Between March and May 2020 last year, the excise duty on petrol was increased by 13 rupees and in diesel by 16 rupees a liter. At present, a total of Rs 32.90 on petrol and Rs 31.80 per liter excise duty is applicable on diesel.
The Center had raised the tax at a time when the price of crude oil was at its lowest level in 2 decades. But when crude oil prices increased in the international markets, the government did not reduce this tax. For this reason, the prices of petrol and diesel rose to record levels. Including central and state government tax, there is 60 per cent tax on petrol and 54 per cent on diesel.