The Finance Ministry has decided to cut down the excise duties on the prices of petrol and diesel which are impacting the domestic prices of fuel and the people of India. The excise duties are making up the 60 percent of the retail price of the petrol and diesel in the country.
This comes after the country is facing the doubling in the prices of petrol and diesel due to high increment in the excise duty for last 10 months.
Amid the downfall in the economy as the outcome of the pandemic the government increased taxes on petrol and diesel to boost the tax revenues instead of passing the benefits of low fuel prices on the people of the country.
Now after various consultations with the oil companies, states authorities and oil ministry the Finance Ministry has planned to cut down the burden of excise duties in such a way that does not hugely impacts the government revenue
However, the government does not want to change the tax structure so it wants the oil prices to get stable before cutting down the excise duties on petrol and diesel.
Giving an unclear message the Finance Minister Nirmala Sitharaman said, “I can’t say when we will reduce taxes on fuel, but (the) centre and states have to talk to reduce fuel taxes”.
The public demand has forced many states to reduce taxes on petrol and diesel on their state level.
The Centre and the state governments have together made a revenue of about Rs 5.56 lakh crore from the petroleum sector for the fiscal year of 31 March, 2020 and of about Rs 4.21 in the nine months from April-December despite a heavy reduction in demand due to the lockdown.