The Government of India has decided to reduce the Basic Excise Duty rate on Petrol and Diesel [both branded and unbranded] by ₹ 2 per litre with effect from 4th October, 2017. This decision has been taken by the Government in order to cushion the impact of rising international prices of crude petroleum oil and petrol and diesel on Retail Sale Prices of Petrol and Diesel as well as to protect the interest of common man.
The Revenue loss on account of these reductions in excise duty is about ₹ 26,000 crore in a full year, and about ₹ 13000 crore during the remaining part of the current financial year.
Earlier due to the increase in the international prices of Petrol and Diesel, during the last few weeks, the Retail Selling Prices (RSP) of Petrol and Diesel at Delhi have risen to ₹ 70.83/litre and ₹ 59.07/litre respectively, as on 2nd October 2017. This rise in the prices of Petrol and Diesel is also reflected in WPI inflation, which has increased to 3.24% for the month of August 2017, as compared to 1.88% for the month of July 2017.This also prompted the Government to act swiftly in this regard.
Excise duty reduction on petrol and diesel to moderate retail fuel prices amid rising international crude costs. Reduction of
Basic Excise Duty on petrol and diesel lowers per litre excise levies on both branded and unbranded fuels effective 4 October 2017 to moderate retail price increases from rising international crude and product prices, and is described as a fiscal measure to protect consumers from price shocks while producing an estimated revenue shortfall for the year.
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