With the possibility of price hike in petrol-diesel in the near future, the government may increase excise duty

New delhi date. Monday, October 26, 2020

The closure of business and employment in the lockdown has emptied the pockets of the common man. In such a situation, the common man is now likely to get a big shock. This will put another burden on the pockets of the people. According to media reports, the Indian government is once again preparing to increase excise duty on petrol and diesel.

Earlier in May, the government had hiked excise duty on petrol by Rs 10 per liter and diesel by Rs 13 per liter. After that, the tax on petrol has been increased to Rs 32.98 per liter and the tax on diesel to Rs 31.83 per liter. Consumers are not getting the benefit of cheap crude due to the continuous increase in taxes by the governments. People are having to spend more for petrol and diesel.

According to media reports, the government is preparing to bring in a third relief package to offset the damage caused to the economy by Corona. In such a situation the government needs more funds and therefore, the government wants to reimburse it from the excise duty.

According to sources, excise duty may increase by Rs 3 to 6 per liter. But the government wants petrol-diesel not to become more expensive after the tax hike. That's why a new plan is being worked on.

Internationally, crude oil has fallen from 45 45 a barrel to 40 40 a barrel. That is why the government wants to take advantage of it. Petrol-diesel should become cheaper after the fall in crude oil prices. But now it will not happen.

With each increase in excise duty on petrol and diesel, the central exchequer will receive Rs. 13,000-14,000 crore. While the fall in crude prices helps the government reduce the trade deficit. In fact, India buys about 82 per cent of its needs. In such a scenario, a fall in crude prices could also reduce the country's current account deficit (CAD).