Last Updated : Jun 25, 2020 07:55 PM IST | Source: CNBC-TV18

Government mops up Rs 40,000 crore via excise duty on petrol, diesel within first 2 months of FY21

As of June 16, excise duties and state VAT on fuel retail prices accounted for over 65 percent of the retail price.

CNBC-TV18

The government has collected about Rs 40,000 crore from excise duty on petrol and diesel in the first two months of the fiscal, or about 16 percent of its full-year target.

The exchequer's collection rose three times in May, when the government mopped up Rs 29,396 crore (vs Rs 10,560 crore in April) following a steep excise duty hike and as demand rebounded with ease in lockdown restrictions. (On May 5, the government hiked excise duty by Rs 10 per litre on petrol and Rs 13 per litre on diesel.)

Also Read | In a first, diesel costs more than petrol in Delhi after 18th hike in as many days

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The government expects to mop up Rs 2.48 lakh crore in excise duty on petroleum products.
April consumption (‘000 MT)Excise duty (Rs/ltr) April 2020Central Govt Excise revenue (Rs/Cr)May consumption (‘000 MT)Excise Duty (Rs/ltr) May 5, 2020Central govt excise revenue (Rs/Cr)
Petrol97322.983,154.931,76932.988,232
Diesel3,25018.837,404.895,49531.8321,163.6
Total Central excise revenue from petrol/diesel10,559.8229,395.6

With the government easing lockdown conditions in May, consumption of diesel shot up 169 percent to 54.95 lakh Metric Tonne (MT) as against 32.50 lakh MT in April.

Similarly, petrol consumption shot up 182 percent in May at 17.69 lakh MT compared to 9.7 lakh MT in April this year.
Fuel TypeApril (MT ‘000)May (‘000 MT)
Diesel3,2505,495 ↑ 169.08%
Petrol9731769  ↑ 181.81%
Fuel consumption levels have reached 90 percent level compared to pre-COVID levels as economic activity restarts.

Following an 82-day pause during the lockdown, fuel retailers started increasing prices every day beginning June 7 to match the international fuel prices. This means that the hike is a win-win for states as well as state VAT on petrol and diesel is levied on an 'ad valorem' basis, that is as a percentage of the price.

As of June 16, excise duties and state VAT on fuel retail prices accounted for over 65 percent of the retail price.

Source: CNBC-TV18

First Published on Jun 24, 2020 08:47 pm
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