Government May Hike Special Excise Duty on Fuels

The government is considering another increase in special excise duty on petrol and diesel to get a share of the windfall profits of oil marketing companies arising from low crude prices, people familiar with the matter said.

- Rajeev Jayaswal

NEW DELHI:

There has been a 16.7% fall in the country's average crude oil import price (Indian basket) to $61.9 a barrel on Wednesday as compared to $74.31 a barrel on April 7, the day the government announced excise duty hikes on petrol and diesel by ₹2 a litre. That increase was expected to fetch the government ₹32,000 crore in 2025-26; if the government goes ahead with a ₹4 increase (per litre) in the second round, it would fetch an additional ₹64,000 crore this fiscal.

"In a war-like situation, this is the right thing to do," one of the people cited above added, asking not to be named, and referring to India's measured, but strong response to Pakistan-sponsored terrorists killing 26 civilians in Pahalgam on April 22, through targeted strikes against nine terror hubs in Pakistan-occupied Kashmir and Pakistan itself on May 7.