Petrol and diesel rates were increased on Saturday, a day after Finance Minister Nirmala Sitharaman presented the annual Budget. Sitharaman had proposed an increase in excise duty and road cess of Rs 1 per litre each on the fuels.
Petrol rates have now been increased by Rs 2.45 per litre while diesel prices have been raised by Rs 2.36 per litre. After this increase, petrol in Delhi is priced at Rs 72.96 per litre while diesel costs Rs 66.69 per litre. In Mumbai, diesel prices were increased to Rs 69.90 per litre while petrol is Rs 78.57 for every litre. Petrol and diesel prices in Kolkata are Rs 75.15 and Rs 68.59, according to Indian Oil Corporation’s website.
“Crude prices have softened from their highs, this gives me room to review excise duty and cess on petrol and diesel,” Sitharaman had said on Friday while presenting her first Union Budget in Parliament. “I proposed to increase special additional excise duty and road and infrastructure cess each by Rs 1 per litre on petrol and diesel.”
Sitharaman dismissed speculation that levies on petrol and diesel could fuel inflation, saying that the decision was an attempt to meet public funding needs, NDTV reported. Taxes on fuel, which account for over a third of retail fuel prices, are one of the primary sources of government revenue.
Until Friday, petrol was priced at Rs 70.51 per litre in Delhi, Rs 76.15 per litre in Mumbai, and Rs 72.75 per litre in Kolkata on July 5. Diesel was priced at Rs 64.33 for each litre in Delhi, Rs 67.40 for each litre in Mumbai, and Rs 66.23 in Kolkata, the Indian Oil Corporation website.
While it has been a common practice to cut duties when global crude prices increased, since 2014, the government has often increased excise duty despite a fall in global prices, to increase their revenue.