Diesel prices too made a record at Rs 92.1 a litre in Sri Ganganagar, while generally raging well above Rs 80 per litre in other states. Unmoved by these record prices, the Centre has ruled out any tax cut and is blaming oil exporters for jacking up crude prices.
This is unlike in October 2018, when, after petrol price rose to Rs 84 a litre and diesel Rs 75.45 in Delhi, the Centre had reduced excise duty by Rs 2 per litre on October 4 and by Rs 1.5 the next day.
Some 18 states also reduced VAT at Centre’s behest. Consumers in Rajasthan pay more than others because the state has the highest tax on petrol and diesel.
High taxes imposed by the Centre and states are a major reason behind the soaring prices of fuel, which in turn pushes upwards the price of food, vegetables and other essential commodities. In times when the economy is down in the dumps, the government must reduce taxes on petroleum products to reduce the problems of ordinary citizen.
After reducing VAT by 2% last month, it charges 36% VAT and road cess of Rs 1,500 per kilolitre on petrol. Diesel attracts 26% VAT and road cess of Rs 1,750 per kilolitre.
Rajasthan is an outlier among states. It is the high level of excise duty and multiple cess levied by the Centre that is pushing petrol and diesel prices to record highs in other states. On a litre of petrol, the Centre charges Rs 1.4 as basic excise duty, Rs 18 as road and infrastructure cess, Rs 11 as special additional excise and Rs 2.5 as agriculture cess.
On diesel, it levies Rs 1.8 as basic excise, Rs 18 as road and infrastructure cess, Rs 8 as special additional excise, and Rs 4 as agriculture cess. So a consumer in Delhi, which is the reference market, pays Rs 32.9 on a litre of petrol and Rs 31.8 on a litre of diesel as central taxes.