Petrol Price Hiked By Rs 2.45, Diesel By Rs 2.36
Petrol price on Saturday was hiked by a minimum Rs 2.40 per litre and diesel by Rs 2.36 after Finance Minister Nirmala Sitharaman raised taxes on the fuels to part-fund her budget for 2019-20.
Petrol price in Delhi was increased by Rs 2.45 per litre to Rs 72.96 while the increase in Mumbai was Rs 2.42 to Rs 78.57, according to a price notification issued by state-owned Indian Oil Corporation Ltd. In Kolkata, petrol price went up by Rs 2.40 to Rs 75.15 and in Chennai by Rs 2.57 to Rs 75.76 a litre.
Diesel price was hiked by Rs 2.36 per litre in Delhi to Rs 66.69 and by Rs 2.50 per litre in Mumbai to Rs 69.60.
Sitharaman had on Friday raised excise duty and road and infrastructure cess on petrol and diesel by Rs 2 per litre each to raise Rs 24,000-28,000 crore on an annual basis.
Adding local sales tax or value-added tax, which is charged on top of central excise duty on base price, the increase in pump rates was higher.
"Crude prices have softened from their highs. This gives me a room to review excise duty and cess on petrol and diesel. I propose to increase Special Additional Excise duty and Road and Infrastructure Cess each by Rs two a litre on petrol and diesel," she said in her budget speech.
Before the tax increase, petrol attracted total excise duty of Rs 17.98 per litre (Rs 2.98 basic excise duty, Rs 7 special additional excise duty and Rs 8 road and infrastructure cess). Now, this tax has gone up to Rs 19.98 a litre.
On diesel, a total of Rs 13.83 per litre excise duty was charged (Rs 4.83 basic excise duty, Rs 1 special additional excise duty and Rs 8 road and infrastructure cess). Now, Rs 15.83 per litre is charged as excise duty.
On top of these, VAT is charged which varies from state to state. In Delhi, VAT is levied at the rate of 27 percent on petrol and 16.75 percent on diesel. In Mumbai, VAT on petrol is 26 percent plus Rs 7.12 a litre additional tax while diesel attracts 24 percent sales tax.
Since the Modi government came into power in 2014, excise duty on petrol and diesel has been cut only twice but raised on ten occasions, including the one on Friday. The last time, the duty was revised in October 2018 when excise duty was lowered by Rs 1.50 a litre each on petrol and diesel. The government had in October 2017 also cut the same by Rs 2 a litre.
The BJP-government at the centre had raised excise duty on petrol by Rs 11.77 a litre and that on diesel by Rs 13.47 a litre in nine installments between November 2014 and January 2016 to shore up finances as global oil prices fell.