Petrol, Diesel Will Be Cheaper By Rs 5? Govt Can Reduce 50% Excise Duty!

The Indian Ministry of Petroleum has a little new year gift for its citizens. Unlike the usual circumstances, this time the rates of petrol are going to go down. The good news has arrived after the price of fuel across the country has reached the maximum threshold now.

Much like what every citizen wanted, the ministry has proposed to cut down the excise duty on petrol and diesel resulting in a significant drop in its price. 

What Will Be The New Rates Of Petrol?

The current rates of fuel in Delhi are priced at Rs 84 and Rs 74.38 for one liter of petrol and diesel respectively. Even after petrol being cheapest in Delhi, this is for the first time that the prices of petrol have crossed the mark of Rs 84 per litre there. On the other hand, the fuel is even more expensive in Mumbai with petrol priced at Rs 90.83 and diesel at Rs 81.07 per litre.

With the ministry of petroleum proposing to bring down excise duty by 50%, the prices of petrol and diesel can get cheaper by Rs 5 per unit if the proposal gets accepted by the government. In that case, the price of petrol in Delhi will be reduced to Rs 78 and diesel to Rs 68 per litre.

Why Are The Prices Reduced?

The pandemic induced lockdown last year gave rise to inflation. The value-added taxes surged up and the government was compelled to increase the excise duty on petrol by Rs 10.  For lowering the price of petroleum now, the Government is expecting the cooperation of the state to reduce VAT. It has also appealed to the oil companies to endure for the time being.

Recently, a community social media platform named Local Circles carried out a survey involving 9,326 citizens of 201 districts of the country. The survey analysed that around 69% of these people want the price of petrol to reduce by at least 20% or six rupees. The survey also highlighted the effect of the pandemic on the income of normal people because of the overall blow on the economy. Around 71% of the respondents of the survey were male while the remaining 29% were female.

A couple of days before, the petrol prices were inflated by 23 paise and diesel by 26 paise per litre. At present, around 62% of the unit price of petrol goes into taxes. The base price of petrol in Delhi is just Rs 26 per liter. But with the inclusion of taxes of Rs 51.98, one has to pay Rs 84 for one liter of petrol in Delhi. Along with the taxes, the charges of dealer commissions and local taxes are also included in the final price.