The government hiked the excise duty on petrol and diesel by Rs 10/L and Rs 13/ respectively from the 6th of May, 2020. The consumer charge goes up by Rs 1.67 per litre and Rs 7.10 per litre.

Petrol & Diesel prices hike? why?

The government hiked the excise duty on petrol and diesel by Rs 10/L and Rs 13/ respectively from the 6th of May, 2020. The consumer charge goes up by Rs 1.67 per litre and Rs 7.10 per litre. The increase in indirect tax imposed on the production of petrol and diesel is done so that the government could earn more as due to lockdown most of the industries are shut.

Due to an uncertain situation of a pandemic the income of the government has also been sealed as there is no working industry and zero sales lead to a collection of nothing to the government which is why they have increased the excise duty on petrol although the prices of crude oil have gone down by more than 50% on the account of COVID-19 since the start of this year.

4 Things to know:

  • The excise duty on petrol before this hike was Rs 22.98 per litre and on diesel, it was Rs 18.83 which changed to Rs 32.98/L and 32.83/L after the hike.
  • The further breakdown of the excise duty on petrol: the special additional excise duty is hiked by Rs 2/L and road cess by Rs 8 per litre Similarly in the case of diesel the increase is approximate of Rs 5 per litre in the special additional excise duty, and Rs 8 per litre in road cess, according to central board of indirect taxes and customers
  • Crude oil price is gone as low as $0.16 per litre due to the zero demand all over the world, Most of the countries including India have filled their reserves. Fuel prices can decrease in the near future after the lockdown.
  • Fuel prices vary from state to state in our country based on factors such as local taxes and dealer commission. 90 per cent of the companies are run by the state.

Fuel price in different states(Petrol/Diesel) :

Uttar Pradesh: Rs 71.95/62.9

Delhi: Rs 71.26/69.39

Mumbai: Rs 76.31/66.21

Bangalore: Rs 73.55/65.94

Chennai: Rs 75.54/68.2

India is currently in the third stage of lockdown till May 17 as ordered by the central government. Some states like Telangana have announced a lockdown till May 29 but with some relaxations.

India reported more than 3900 cases on May 6 which is highest in a single day. According to the witnessed pattern of coronavirus (COVID-19), the third month is quite crucial as the most number of cases as recorded in the third month from the time it starts. Various studies have proved and witnessed happening around the world.

Why did Gov increase excise duty on fuel?

The Reason for a hike in fuel prices is simply because of lockdown which happened because of Coronavirus Pandemic. As Gov needs funds badly at this time which can only be earned from very few things as most of the non-essential goods industries can’t work under lockdown. The Arvind Kejriwal’s Aam Admi Party(AAP) has increased excise duty but the price of fuel is similar as earlier price. Government has failed to give the benefit of decreased crude oil price to the consumer as they themself need the money to run the nation as they won’t get any tax revenue for the month of April and May.

#staysafe #stayhome

 

Petrol Rate Build-Up In Delhi On May 6

Component Rate In Rupees Per Litre
Base price 17.96
Freight etc. + 0.32
The price charged to dealers (excluding excise duty and VAT) 18.28
Excise duty + 32.98
Dealer commission (average) + 3.56
VAT (including VAT on dealer commission) + 16.44
Retail selling price (rounded) 71.26
(Source: iocl.com)

 

Diesel Rate Build-Up 

Component Rate In Rupees Per Litre
Base price 18.49
Freight etc. + 0.29
The price charged to dealers (excluding excise duty and VAT) 18.78
Excise duty + 31.83
Dealer commission (average) + 2.52
VAT (including VAT on dealer commission) + 16.26
Retail selling price (rounded) 69.39
(Source: iocl.com)

 

 

 

 

 

 

 

 

 

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