Excise Duty Cut on Petrol, Diesel to Cost Rs 10,500 Crore, Arun Jaitley Asks States to Reduce VAT on Fuel
Jaitley, however, said the expected impact of Rs 10,500 crore is 0.05 per cent of the budgetary deficit.
New Delhi, October 4: Union Finance Minister Arun Jaitley, who announced a reduction of Rs 2.5 on petrol and diesel prices, said the cut in excise duty would cost Rs 10,500 crore for half of the fiscal. Jaitley, however, said the expected impact of Rs 10,500 crore is 0.05 per cent of the budgetary deficit. "The reduction in excise duty on petrol and diesel will cost Rs 10,500 crore, which is 0.05 per cent of the fiscal deficit," Jaitley said.
While anouncing a cut of Rs 2.5 in excise duty on petrol and diesel, the finance minister urged the state governments to reduce VAT on fuel. "We are writing to the state governments that as the central government is cutting Rs 2.50 on both petrol and diesel, they do the same," Jaitley added. Following his request, state governments in Maharashtra, Uttar Pradesh, Gujarat and Assam reduced VAT on fuel prices.
Jaitley announced at a press conference that the cut will be effected through slashing of excise duty to the tune of Rs 1.50 per litre, while the oil marketing companies will absorb the impact to the tune of Re 1 per litre. The important announcement came prices of petrol and diesel went record high in the past few weeks. Price of petrol hit the Rs 84 per litre mark in Delhi, and diesel price crossed Rs 80 per litre mark in Mumbai.
After Thursday's revision, petrol is being sold at Rs 84 per litre in Delhi and diesel costs Rs 75.45 per litre. A litre of petrol now costs Rs 91.34 in Mumbai and diesel is being priced at Rs 80.10.
(The above story first appeared on LatestLY on Oct 04, 2018 04:08 PM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).