Image Source : PTI Petrol pump workers fill petrol in vehicles as fuel prices reduce. India may borrow 1 trillion rupees ($12.9 billion) that the Centre will forgo as revenues after a cut in petrol, diesel prices, Bloomberg reported quoting people familiar with the matter. Reports said that the loss to the exchequer post the reduction of excise duty on petrol and diesel will be borne through additional borrowings. Bloomberg report further said that higher GST collections, as well as personal income taxes, will be neutralised by additional spending on food and fertilizer subsidies to support the poor and farmers. Amidst rising energy prices and inflation, the Central excise duty on petrol has been cut by Rs 8 per litre and on diesel by Rs 6 per litre, reducing the price of petrol by Rs 9.5 per litre and of diesel by Rs 7 per litre, Union Finance Minister Nirmala Sitharaman said. “Today, the world is passing through difficult times. Even as the world is recovering from Covid-19 pandemic, the Ukraine conflict has brought in supply chain problems and shortages of various goods. This is resulting in inflation & economic distress in a lot of countries,” she said in a series of tweets. The duty cut will have revenue implications of around Rs 1 lakh crore per year for the government. Sitharaman went on to say that despite the challenging international situation, the government has ensured that there are no shortages or scarcity of essential goods. Even a few developed countries couldn’t escape some shortages or disruptions, she added. The government is committed to ensuring that prices of essential items are kept under control, she said. She said, “I wish to exhort all state governments, especially the states where reduction wasn’t done during the last round (November 2021), to also implement a similar cut and give relief to the common man.” ALSO READ | Maharashtra govt slashes VAT on petrol and diesel after Kerala and Rajasthan ALSO READ | Fuel price cut: Sitharaman explains math behind excise duty, compares govt’s spending before and after 2014 Latest Business News
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