Despite duty cut, Centre’s oil revenue set to rise 13%
, TNN|
Updated: Oct 06, 2017, 11.38 AM IST
NEW DELHI: Despite the cut in excise duty on petrol and diesel, the Centre can still hope to rake in Rs 2.73 lakh crore from petroleum, oil and lubricants (POL) this year, the Central Board of Excise and Customs (CBEC) has estimated.
The reduction will cost the exchequer around Rs13,000 crore during the second half of the financial year but the estimated collections will still be 2.75 times higher than the collections in 2014-15, the first year of NDA rule.
Compared to the last financial year, when the Centre collected Rs 2.42 lakh, crore the increase will be of the order of 13%.
In a presentation prepared by CBEC, just a week before the duty cut, the revenue authority said that the Centre collected Rs 91,000 crore as central excise from POL during April-June 2017. Between July 2017 and March 2018, revenue from POL was earlier estimated at Rs 1.95 lakh, taking the annual collection for the year to Rs 2.86 lakh crore, a senior official told TOI.
While oil prices declined, the NDA government opted to retain a part of the gains by significantly increasing excise duty on petrol and diesel since taking charge in May 2014.
The levy on petrol was increased by Rs 11.77 a litre and on diesel by Rs 13.47 a litre during the last three years when international crude prices crashed to as low as $30 a barrel at one point from a high of $112 a barrel in 2014.
The international crude prices have since started going up, which resulted in an increase in prices at the pumps but the government had opted to keep the levies unchanged despite mounting criticism.
Traditionally, governments at the Centre and states have relied on easy pickings such as POL to raise resources to meet their funding requirements.
Sources said that the increase in taxes was done in a way that the gains of the lower crude prices are shared between the consumer, the government and the oil companies.
The April-June revenue of central excise of Rs 91,000 crore also includes earnings from cess on tobacco, though the amount is very insignificant, the CBEC official said.
The reduction will cost the exchequer around Rs13,000 crore during the second half of the financial year but the estimated collections will still be 2.75 times higher than the collections in 2014-15, the first year of NDA rule.
Compared to the last financial year, when the Centre collected Rs 2.42 lakh, crore the increase will be of the order of 13%.
In a presentation prepared by CBEC, just a week before the duty cut, the revenue authority said that the Centre collected Rs 91,000 crore as central excise from POL during April-June 2017. Between July 2017 and March 2018, revenue from POL was earlier estimated at Rs 1.95 lakh, taking the annual collection for the year to Rs 2.86 lakh crore, a senior official told TOI.
While oil prices declined, the NDA government opted to retain a part of the gains by significantly increasing excise duty on petrol and diesel since taking charge in May 2014.
The levy on petrol was increased by Rs 11.77 a litre and on diesel by Rs 13.47 a litre during the last three years when international crude prices crashed to as low as $30 a barrel at one point from a high of $112 a barrel in 2014.
The international crude prices have since started going up, which resulted in an increase in prices at the pumps but the government had opted to keep the levies unchanged despite mounting criticism.
Traditionally, governments at the Centre and states have relied on easy pickings such as POL to raise resources to meet their funding requirements.
Sources said that the increase in taxes was done in a way that the gains of the lower crude prices are shared between the consumer, the government and the oil companies.
The April-June revenue of central excise of Rs 91,000 crore also includes earnings from cess on tobacco, though the amount is very insignificant, the CBEC official said.
(This article was originally published in The Times of India)
