The unprecedented hike in the prices of fuel has added to the woes of the common man as the continuous hike in fuel rates has put heavy burden on Indian households. The other day, I had to shell out Rs.910 for the non-subsidized LPG cylinder.
The prices of LPG have been hiked continuously during Modi govt regime. It was available at Rs.414 in 2014. As such price has been more than doubled during last seven years.
And so are the price of Petrol and diesel soaring to a new record highs across the country on Sunday (October 31) after the rates were hiked for the fifth consecutive day across the country. The state-run oil marketing companies (OMCs) hiked fuel rates by 35 paise per litre each on Sunday.
Accordingly, petrol is retailing at Rs 109.34 per litre and diesel at Rs 98.07 per litre in Delhi.In Mumbai petrol is priced at Rs 115.15 per litre and diesel Rs 106.23 a litre of diesel. It is the highest among all In Chennai, petrol has breached the Rs 105-a litre mark and is retailing at Rs 106.04 per litre whereas diesel costs Rs 102.25 per litre. In Kolkata, petrol is available at Rs 109.79 per litre and diesel Rs 101.19 per litre. Petrol is retailing at Rs 113.15 per litre and diesel at Rs 104.09 in Bengaluru.
in the same period.
Undoubtedly,the petrol and diesel prices are higher in India due to heavy taxes being levied on petrol and diesel. It is to be noted that 58.6 percent of the petrol price and 52.85 percent of the diesel in Delhi is tax. Around 63% of total taxes on petrol is while the state tax is Rs 19.27. Similarly, the diesel price reached Rs 92.27 in the city. On this fuel the central tax is Rs 31.80 and the state tax Rs 13.08.
Taxes (both central and local) make up around 50% of the retail price of petrol and diesel. Around 54% of the retail price of petrol comprises central and states taxes. In the case of diesel, this is close to 49%. The central government taxes the production of petroleum products, while states tax their sale. The central government levies an excise duty of Rs 32.9 per litre on petrol and Rs 31.8 per litre on diesel. These make up 31% and 34% of the current retail prices of petrol and
diesel, respectively.
While excise duty rates are uniform across the country, states levy different sales tax/ Value Added Tax (VAT) varying from state to state. Besides, additional levies are also imposed . For instance, Odisha levies 32% VAT on petrol, while Uttar Pradesh levies 26.8% VAT . Apart from VAT, Tamil Nadu also levy certain additional levies such as cess (Rs 11.5 per litre).
In fact, petrol and diesel are the holy cow for union and state governments to milk as much revenue as possible.There is nearly 459 per cent rise in taxes collected on petrol and diesel in the last seven years.
The central government’s total excise duty collection from petrol, diesel, ATF, natural gas and crude oil has increased from Rs 2.37 lakh crore in 2016-17 to Rs 3.01 lakh crore during April-January 2020-21.
The union govt promise to cut down duties on petrol, diesel if international prices of crude oil come down but instead of giving relief to people, Modi government had raised excise duty on petrol and diesel on nine occasions between November 2014 and January 2016 to take advantage of lower global oil prices.
As the unemployment is rising, the nation’s middle class shrank by 32 million people in 2020, according to the Pew Research Center. It still hasn't recovered in 2021. So burdening the middle class with unabated hike in petrol and diesel will only add to the woos of the people.
Isn't it a cheating?
(Chander Sharma)
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