Budget 2018: Excise duty on petrol, diesel cut; Relief to vehicle owners

Randall Padilla
February 2, 2018

However, this made no difference in the rising petrol and diesel price as the government has proposed a levy on road and infrastructure cess of Rs 8 per litre in Budget 2018-19. While the government cut excise duty, a new road cess of Rs 8 per litre was also introduced. Alongside this, the Finance Minister Arun Jaitley has also announced to cut down the excise duty on fuel by Rs 2. "This is jumlanomics. The announcement to cut excise duty on petrol was fraudulent as the government has silently hiked the cess on fuel", said CPM chief Sitaram Yechury.

Since then prices are revised on daily basis. Indian Oil Corp (IOC) Chairman Sanjiv Singh on Monday responding to the charges of government meddling in fixing of fuel prices said that Petrol and diesel prices in India are to a "large extent" aligned to worldwide rates.

Interestingly, the rate of brent crude oil was around $128 per barrel in September 2013, when the petrol prices in Mumbai had skyrocketed to as high as Rs 83.62.

"We urge fuel retailers to be fair to motorists and pass on the current savings in the wholesale price of petrol and diesel at the pump". It will come into effect immediately owing to a declaration under the Provisional Collection of Taxes Act, 1931.

The Budget reduced basic excise duty on branded and unbranded petrol as well as diesel.

According to TaxGuru data, total excise duty on motor spirit remains unchanged.

Because of the excise duty cut, diesel prices had on October 4, 2017 come down to Rs 56.89 and petrol to Rs 68.38. Production curbs by the Organisation of the Petroleum Exporting Countries and high demand have led to the surge.

The FM has, however, further lowered the excise duty revenue receipt estimate for FY19 to Rs 259,600 crore.

In January, fuel prices touched a 40-month high in Mumbai.

It may ne mentioned that higher crude price comes as a negative outcome for India, as the government is impacted by this trend in two ways. States are also able to levy variable taxes as a result of which prices vary across states.

Other reports by AllAboutTopnews

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