New Delhi: The Narendra Modi government on Monday ruled out any excise duty cut on petrol and diesel despite these petroleum products retailing at all-time highs, as the Center can’t afford to take a hit on revenue collections amid huge planned public expenditure.
While a cut in excise duty that the central government levies will impact fiscal deficit, states like Bihar, Kerala, and Punjab are not in a position to cut sales tax (or VAT), a govt official, who wished not to be identified, told news agency Press Trust of India.
The government believes that international oil prices, which together with a drop in the value of rupee has been fuelling the fuel price rise to record levels, will moderate in coming days to take pressure off.
It may be noted that the opposition parties led by Congress held nationwide protests against record high petrol and diesel prices yesterday. Prices in Delhi, where rates are the cheapest among all metros and most state capitals because of a lower VAT, saw petrol touch an all-time high of Rs 81.87 per litre Tuesday while diesel scaled to a new high of Rs 72.97 a litre.