Finance ministry considers cutting taxes on petrol, diesel: Sources


2021-03-01 17:33:32

NEW DELHI: The finance ministry is considering cutting excise duties on petrol and diesel to cushion the impact of record-high domestic prices, three government officials close to the discussions said.
A doubling in the price of crude oil over the past 10 months has contributed to record fuel prices at gas stations in India. But taxes and duties account for roughly 60% of the retail price of petrol and diesel in the country, the world’s third-biggest consumer of crude oil.
As the coronavirus pandemic hit economic activity, the government twice raised taxes on petrol and diesel in the last 12 months to boost sagging tax revenues instead of passing on the benefits of low oil prices last year to consumers.
The finance ministry has now started consultations with some states, oil companies and the oil ministry to find the most effective way to lower the tax burden on consumers without federal finances taking a big hit, the sources said.
“We are discussing ways in which prices can be kept stable. We will be able to take a view of the issue by mid-March,” said one of the sources.
The sources, who asked not to be named as the deliberations are private, said the government wants oil prices to stabilise before cutting taxes, as it does not want to be forced to change the tax structure again, should crude prices rise further.
Finance minister Nirmala Sitharaman recently 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 finance ministry and oil ministry did not respond to an email requesting comment.
The high fuel prices have prompted some Indian states to cut state-level taxes on petrol and diesel to rein in prices.
“There is an expectation that OPEC+ would agree to ease oil output curbs, we hope oil prices will stabilise after their decision,” this source said.
India has called on OPEC+ to ease production cuts as higher crude prices are hitting fuel demand in Asia’s third largest economy and are contributing to inflation.
The high fuel prices could also affect Modi’s popularity ahead of state assembly polls in four states in March and April.
The central government is already facing their biggest political challenge in years with tens of thousands of farmers protesting against three farm laws passed in 2020.
The central and state government together raised some 5.56 trillion rupees ($75.22 billion) in revenues from the petroleum sector in the fiscal year ended March 31, 2020, based on government data.
In the nine months of this fiscal year (April-December 2020), contributions from the sector were about 4.21 trillion rupees, despite a significant decline in local fuel demand, the data showed.



Source link

75 Comments

  1. MarcosEtess March 4, 2021
  2. WesleyUtiff March 5, 2021
  3. JasonLup March 8, 2021
  4. Randyabemi March 8, 2021
  5. JasonLup March 8, 2021
  6. Randyabemi March 9, 2021
  7. Wayneweday March 11, 2021
  8. Jasonker March 12, 2021
  9. Wayneweday March 12, 2021
  10. Jasonker March 12, 2021
  11. Jasonker March 13, 2021
  12. Jasonker March 13, 2021
  13. Jasonker March 13, 2021
  14. Wayneweday March 14, 2021
  15. Wayneweday March 15, 2021
  16. Michaelzes March 16, 2021
  17. Ricardomus March 16, 2021
  18. Ricardomus March 17, 2021
  19. Michaelzes March 17, 2021
  20. Ricardomus March 18, 2021
  21. KevinLot March 18, 2021
  22. KevinLot March 18, 2021
  23. Ricardomus March 19, 2021
  24. Ricardomus March 20, 2021
  25. MarvinHag March 22, 2021
  26. Terrymex March 22, 2021
  27. Terrymex March 22, 2021
  28. MarvinHag March 23, 2021
  29. Peterhed March 25, 2021
  30. MarvinHag March 25, 2021
  31. Peterhed March 26, 2021
  32. MarvinHag March 26, 2021
  33. Peterhed March 26, 2021
  34. Peterhed March 27, 2021
  35. MarvinHag March 27, 2021
  36. Peterhed March 27, 2021
  37. Peterhed March 28, 2021
  38. MarvinHag March 28, 2021
  39. Peterhed March 29, 2021
  40. Rafaeljap March 29, 2021
  41. VictorJonge March 29, 2021
  42. Rafaeljap March 30, 2021
  43. VictorJonge March 31, 2021
  44. Frankhem April 1, 2021
  45. Frankhem April 2, 2021
  46. BillyBlant April 3, 2021
  47. Charlesget April 4, 2021
  48. Michaeltrevy April 5, 2021
  49. Charlesget April 5, 2021
  50. Michaeltrevy April 5, 2021
  51. Michaeltrevy April 6, 2021
  52. Charlesget April 6, 2021
  53. Alfredted April 7, 2021
  54. Robertnom April 7, 2021
  55. Robertnom April 8, 2021
  56. Robertnom April 9, 2021
  57. Alfredted April 9, 2021
  58. HarryShife April 10, 2021
  59. Michaelton April 10, 2021
  60. HarryShife April 11, 2021
  61. Michaelton April 11, 2021
  62. Robertovob April 13, 2021
  63. ClaudScoox April 13, 2021
  64. Robertovob April 14, 2021
  65. ClaudScoox April 14, 2021
  66. Robertovob April 15, 2021
  67. ClaudScoox April 15, 2021
  68. Robertovob April 16, 2021
  69. ClaudScoox April 17, 2021
  70. Robertovob April 17, 2021
  71. Rafaelweilk April 17, 2021
  72. Pierredob April 18, 2021
  73. Rafaelweilk April 18, 2021
  74. Rafaelweilk April 19, 2021
  75. Rafaelweilk April 20, 2021

Leave a Reply