Move does not impact states’ tax sharing, entire burden being borne by Centre: FM
Petrol price slashed by Rs 8.69/litre, diesel by Rs 7.05/litre
NEW DELHI: Finance Minister Nirmala Sitharaman on Sunday rebutted the Opposition’s criticism of excise duty cut impacting share of states in central taxes, saying the Rs 8 a litre cut in petrol and Rs 6 reduction in diesel have been done in road and infrastructure cess levied on the two fuels, collection on which was never shared with states.
Petrol price on Sunday was slashed by Rs 8.69 a litre and diesel by Rs 7.05 per litre following the government cutting excise duty on auto fuels to give relief to consumers battered by high fuel prices that has also pushed inflation to record high.
First, former union finance minister P Chidambaram and then other Opposition leaders stated that the reduction in excise duty announced on Saturday evening would reduce the share of states in central taxes.
Chidambaram on Sunday retracted his statement saying the cut in the levies accrues to the central government alone.
Taking to Twitter, Sitharaman said she is sharing some useful facts on levies on petrol and diesel for the benefit of all.
“Basic Excise Duty (BED), Special Additional Excise duty (SAED),Road & Infrastructure Cess (RIC) and Agriculture & Infrastructure Development Cess (AIDC) together constitute Excise Duty on petrol and diesel. Basic ED is sharable with states. SAED,RIC & AIDC are non-sharable,” she said. The excise duty reduction of Rs 8 per litre on petrol and Rs 6 a litre on diesel has entirely been made in RIC. This was the case even in November 2021 when tax on petrol was cut by Rs 5 and that on diesel by Rs 10, she said.
Meanwhile, petrol in the national capital now costs Rs 96.72 a litre as against Rs 105.41 previously. Diesel is now priced at Rs 89.62 per litre as opposed to Rs 96.67 earlier, a price notification from state-owned fuel retailers showed.
In Mumbai, petrol rates have been slashed to Rs 111.35 a litre from Rs 120.51, while diesel rates have come down to Rs 97.28 per litre from Rs 104.77.
Rates differ from state to state