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In a move which is expected to help increase consumption of branded or premium petrol, the Finance Minister Arun Jaitley on Thursday slashed the excise duty on the product. The Central Excise duty on branded petrol has been cut by approximately ₹5 per litre from the earlier ₹7.50 per litre to ₹2.35 per litre.
Public sector oil marketing companies Indian Oil Corporation, HPCL and BPCL declined to comment on the development immediately, stating that the impact of the decision is being studied.
Currently, BPCL sells its branded petrol Speed for ₹83.03 per litre in Delhi while normal petrol is sold for ₹73.55 per litre. The excise duty cut would bring down its price to nearly ₹78 per litre, reducing the gap between normal and branded petrol.
However, Federation of All India Petroleum Traders’ General Secretary Ajay Bansal said it remains to be seen whether more customers purchase branded petrol after the excise duty cut as there is still a significant price difference between the two fuels.
Oil marketing companies claim that branded fuels contain special performance enhancing additives.
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