New Delhi: Recently, the NDA government slashed petrol prices by Rs 2.42 per litre and diesel by Rs 2.25 a litre, as a result of steep fall in international crude oil prices. In Delhi, petrol now costs Rs 58.91 a litre, as compared to its earlier price of Rs 61.33. The reduction would have been almost double but at the same time the government raised excise duty by Rs 2 per litre on both petrol and diesel, thus eroding the benefits to customers.
Surprising facts will come up if we do a comparative analysis of the fall in global crude oil prices and the actual reduction in petrol rate here in India. The most significant is that the taxes levied by the government are more than the actual cost of petrol.
Here's how: Out of its retail selling price – Rs 58.91 a litre – about Rs 29.65 comprises of central and state government taxes. These include excise duty and education cess of Rs 17.46, dealer commission of Rs 2.03, and a VAT of Rs 10.16.
Now compare this to the base price (actual cost of petrol) of Rs 29.26. This means you may more taxes on petrol than its actual price.