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The government today hiked excise duty on petrol and diesel by Rs 2 per litre each to take away gains coming by way of global oil prices dipping to six-year lows.
Oil companies have cut the petrol price by Rs 2.42 per litre and diesel by Rs 2.25 a litre
This is the fourth increase in excise duty on the two fuels since November and cumulatively customers have been denied the benefit of Rs 7.75 per litre reduction in petrol and Rs 6.50 a litre cut in diesel rates that was warranted due to the slump.
A Finance Ministry notification said excise duty on unbranded petrol is being hiked to Rs 8.95 per litre and that on unbranded diesel to Rs 7.96 per litre.
The four excise duty hikes will result in about Rs 20,000 crore in additional revenue this fiscal and will help the government meet its fiscal deficit target of 4.1 per cent of the GDP.
Earlier in the day, Petroleum Minister Dharmendra Pradhan responded to criticism of oil firms not cutting despite near 4 per cent fall in global rates since January 1 saying, the pricing was “not in our hands” as the two fuels have been deregulated.
“What oil companies feel appropriate they will do,” he said.
Alongside Pradhan, B Ashok, Chairman of Indian Oil Corp, the nation’s largest fuel retailer, justified the decision not to revise rates saying oil firms were saddled with huge inventory which need to be compensated.
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