A recent report by PTI has demystified the constantly changing tax structure for the petrol and diesel fuels in India. In the last one year alone, the government of India has hiked the excise duties on fuels five times.
The most recent hike on excise duty came last week (INR 1.6 per litre on petrol and 40 paise on diesel). This hike means, the taxes you pay for a litre of petrol is higher than the actual cost of the fuel itself!
In Delhi, a litre of petrol costs INR 60.70 at the pump but actual cost of production of petrol based on the foreign exchange rates in the later part of October and average crude oil prices is just INR 24.75 litres. Taking into account the margins for the refineries and other costs (logistics), a litre of petrol is sold to the petrol pump dealer for INR 27.24 per litre.
The recent hike in excise duty was absorbed by the oil companies and hence there is no change in the fuel prices. The government received a revenue of INR 99,184 crores in excise collections from the petroleum sector in 2014-15. In the first quarter of 2015-16 fiscal, the excise collections from the sector stood at 99,184 crores.
Video via – InShorts