Runaway fuel prices: To what extent are international oil prices to blame?

Centre is stuck between the devil and the deep blue sea as far as the runaway fuel prices are concerned. Shine Jacob explains the possible options before it and what a cut in the taxes mean for states

Shine Jacob  |  New Delhi 

What is the stand of the government at the Centre on the runaway oil prices? The Union finance ministry is of the view that any cut in excise duty will shrink the developmental expenditure of the government for the financial year, which the government may not like to do in an election year. For every rupee per litre cut in excise duty on petrol and diesel, the Centre will have to forego around Rs 140 billion in revenue.

At present, a fixed Rs 19.48 per litre on petrol and Rs 15.33 per litre on diesel are levied as excise duty by the Centre. The other choice before the government is to ...

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First Published: Fri, September 14 2018. 05:30 IST