New Delhi: In a significant step aimed at bringing relief to people from high petrol and diesel costs, the Central government on Saturday announced a reduction in excise duty on petrol by Rs 8 per litre and on diesel by Rs 6 per litre.
Finance Minister Sitharman announced the move in a series of tweets, estimating a revenue impact of around Rs 1 lakh crore per year. The minister, who made numerous other announcements geared at lowering inflation, said that under the Ujjwala scheme, cylinders will be subsidised. She asked states to lower VAT on fuel goods to help the average person.
On the eve of Diwali last year, the government slashed excise duty on petrol and diesel in a similar manner. It had cut fuel excise duty by Rs 5 per litre and diesel excise charge by Rs 10 per litre.
"The Central Excise Duty on Petrol and Diesel would be reduced by Rs 8 per litre and Rs 6 per litre, respectively. This will lower petrol prices by Rs 9.5 per litre and diesel prices by Rs 7. It will cost the government roughly Rs 1 lakh crore per year in revenue "Sitharam said.
"I urge other state governments, particularly those that did not implement a reduction at the last cycle (November 2021), to do the same and provide relief to the ordinary man," she added.
The minister stated that the government will provide a subsidy of Rs 200 per gas cylinder (up to 12 cylinders) to nearly nine crore Pradhan Mantri Ujjwala Yojana beneficiaries this year. "Our mothers and sisters will benefit from this. This will result in annual revenue of about Rs 6100 crore "she said.
The minister also mentioned the Ukraine war, saying that in addition to the Rs 1.05 lakh crore fertiliser subsidy announced in the budget, an additional Rs 1.10 lakh crore is being provided to help farmers.