Government has increased the Excise duty to generate additional revenue.
During this pandemic situation where lockdown is initiated across India. All the state governments and even central government are facing financial loss and they don’t have much revenue to runs the operations smoothly. Because in the month of April each and every government will receive a hefty amount of tax from their state but due to lockdown only 10% tax is collected by the government. which is very little comparison to 100%.
As a result, Excise duty on petrol and diesel is increased by Rs 10 & 13. This decision is taken this week and with the increased price government will collect additional revenue of 1.3 lakh crores.
However, retail prices of Petrol and Diesel won’t be affected by the increment in excise duty but fuel pump owners will adjust the price gap in this pandemic situation.
For Petrol the road cess is increased by Rs 8/- per litre, where the increment on excise duty is Rs 2/- per litre. In case of diesel, the road cess is Rs 8/- per litre and the increment on excise duty is Rs 5/- per litre. The total excise duty on petrol is now Rs 32.98/- while on diesel is Rs 31.83/-. As we already told the retail prices are won’t be affected. So currently the Retail price of petrol is Rs 71.26/- per litre. While the price of diesel is Rs 69.39/- per litre ( Delhi Prices).
The increment in Excise duty will play a great role in generating additional revenue. However, most of the vehicles are parked in the parking these days. This real additional is generated when the complete lockdown lifts off and all the vehicles hit the roads. As of result, Petrol and Diesel’s consumption got increased. Which helps in generating revenue.
Information Source:- Motorbeam.com