Last week, the spurt in rates, caused by the rally in global oil prices, has led to the oil ministry asking the finance ministry for a cut in excise duty in the Union Budget 2018-19, to be presented in Parliament next week. Since a year ago, the oil companies are changing petrol and diesel prices every day after the new dynamic system of fuel prices was introduced. The price of diesel, meanwhile, remained unchanged today at Rs 68.27 per litre in Mumbai. In fact, in the budget this year, the government has imposed Rs 2 per liter road cess on petrol and diesel on the other hand.
The BJP-led NDA government had raised excise duty nine times between November 2014 and January 2016 to shore up finances as global oil prices fell, but cut the tax only once in October previous year by Rs 2 per litre. The cut in duty has been offset by an additional levy of Rs 8 per litre under Levy of Road and Infrastructure Cess on petrol as well as diesel, according to Memorandum Explaining the Provisions of the Financial Bill, 2018, part of the budget document.More news: Inclusion on Forbes rich list 'now seen as toxic' by Russians
The fuel prices, which are revised on daily basis, have constantly been rising since December 1. Check the price of petrol and diesel in your city as on February 2 here.
The cost of both diesel and petrol is now at its highest since late 2014, new data from RAC Fuel Watch shows. It will come into effect immediately owing to a declaration under the Provisional Collection of Taxes Act, 1931. "Considering that the Union government wants to invest in development of the infrastructure sector, this cess will be an additional source of income for this objective", Mr. Jain added. Production curbs by the Organisation of the Petroleum Exporting Countries and high demand have led to the surge. "This proves our stand that the BJP has always been in favour of capitalists", Siddaramaiah, who also holds the finance portfolio, said.More news: Wynn Macau shares drop after United States rout on harassment claims
In January, fuel prices touched a 40-month high in Mumbai.
Firstly, the government earns substantial revenue from petro-products through taxation, as they have been kept out of the Goods and Services Tax (GST) regime.More news: Action Express takes Rolex 24 victory as reliability woes end Alonso's hopes