No Acche Din for common man! This is what we pay for our fuel!

The Achhe Din promised by Prime Minister Narendra Modi seems to getting further distant. Hard to believe but taxes and duties paid on petrol has now surpassed the actual cost of production of this non-renewable source of energy.

According to a report by PTI, this steep rise in taxes and duties can be attributed to the excise duty that has already been spiked five times this year. The fact that petrol is expensive in Delhi is due to the increase in central and excise duties.

If industry officials are to be believed, the production of petrol actually costs only Rs 24.75 per litre at refineries based on the average cost of gasoline and the foreign exchange rate. If we add the company margin and other additional costs, the retail price of petrol at any petrol pump should be anywhere up to Rs 28. However, the government levies Rs19.06 excise duty along with a dealer commission of Rs 2.26 per litre. Other taxes such as VAT or sales tax adds another Rs 12.14, which raises the price to Rs 60.70 per litre in the national capital.

It’s the same story for diesel as well.

It is expected that the increase in excise duty could result in additional revenue of Rs over Rs 3,000 crore in the remaining fiscal year. One must note that the government has collected Rs 99,184 crore as excise duty from the petroleum sector in 2014-15.

Image Credit: Indiatimes.com