Centre cuts excise duty by ₹8 on petrol, ₹6 on diesel to tame inflation | India News – Times of India

NEW DELHI: The Centre on Saturday slashed excise duty by Rs 8 on petrol and Rs 6 on diesel to bring down fuel prices and ease inflation by reducing transportation charges for the Aam-Aadmi’s daily staples.
The government also announced a Rs 200 subsidy on LPG for consumers who were given connection free of cost under the Ujjwala programme, one of the Narendra Modi government’s flagship social welfare schemes launched in 2016.
The Centre will be foregoing Rs 1 lakh crore in tax revenue in the current financial year as a result of the excise duty cut. The subsidy for Ujjwala consumers will entail an expenditure of Rs 6,100 crore, Finance Minister Nirmala Sitharaman said while announcing the decisions.
This is the second duty cut by the Centre in a little more than six months and will bring down petrol price by Rs 9.50 per litre and diesel by more than Rs 7, depending upon the prevailing VAT rate in states, assuming the base rates remain the same.
The Centre had on November 4, 2021 reduced excise duty by Rs 5 on petrol and Rs 10 on diesel. The latest cut has brought down the excise duty to the pre-pandemic level – rather lower by a few paise. On March 1, 2020, excise duty stood at Rs 19.98 a litre on petrol and Rs 15.83 a litre on diesel. These will. Now be Rs 19.90 and Rs 15.80 a litre, respectively.

The latest cut comes after the Ukraine war resulted in a spike in global prices, which was passed on to consumers resulting in petrol prices crossing the Rs 100 a litre mark and cooking gas cylinders costing over Rs 1,000 in most parts of the country.
The reduction in pump prices will be slightly more in states with higher VAT such as Maharashtra, Rajasthan, Madhya Pradesh and West Bengal than those with lower tax rates. This is because the incremental decrease in state levy will be more in high-tax states as VAT is charged after excise duty, dealer commission and other charges.

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