The hike will be adjusted against the price cut that was warranted because of falling international oil prices
The increase in duties will come into force on the April 8, 2025. Representational Pic/File
The government on Monday hiked excise duty on petrol and diesel by Rs 2 per litre each but there will be no change in retail prices, reported the PTI.
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The hike will be adjusted against the price cut that was warranted because of falling international oil prices, according to the PTI.
The excise duty on petrol was hiked to Rs 13 per litre and that on diesel to Rs 10 a litre, an official order stated on Monday.
The increase in duties will "come into force on the 8th day of April, 2025," it said.
PSU Oil Marketing Companies have informed that there will be no increase in retail prices of #Petrol and #Diesel, subsequent to the increase effected in Excise Duty Rates today.#MoPNG
— Ministry of Petroleum and Natural Gas #MoPNG (@PetroleumMin) April 7, 2025
While any change in taxes are normally passed on to consumers, there will be no change in retail selling price of petrol and diesel as the excise hike will be set off against the reduction in retail prices that was warranted from fall in international oil prices, as per the PTI.
The international oil prices have slumped to their lowest since April 2021 as escalating trade tensions between the United States of America and China stoked fears of a recession that could cut oil demand, the news agency reported.
According to the PTI, Brent futures lost USD 2.43, or 3.7 per cent, to USD 63.15 a barrel on Monday while US West Texas Intermediate crude futures were down USD 2.42, or 3.9 per cent, at USD 59.57.
India is 85 per cent dependent on imports to meet its oil needs.
"PSU Oil Marketing Companies have informed that there will be no increase in retail prices of petrol and diesel, subsequent to the increase effected in Excise Duty Rates today," the Ministry of Petroleum and Natural Gas said in a post on X.
The government during its 11-year rule hiked excise duty whenever international oil prices fell.
The government had between November 2014 and January 2016, raised excise duty on petrol and diesel on nine occasions to take away gains arising from plummeting global oil prices, as per the PTI.
In all, duty on petrol rate was hiked Rs 11.77 per litre and that on diesel by 13.47 a litre in those 15 months that helped government's excise mop-up more than double to Rs 2,42,000 crore in 2016-17, from Rs 99,000 crore in 2014-15.
The government had cut excise duty by Rs 2 in October 2017, and by Rs 1.50 a year later. But it raised excise duty by Rs 2 per litre in July 2019. It again raised excise duty on March 2020, by Rs 3 per litre each.
Excise duty was raised by Rs 13 and Rs 16 per litre on petrol and diesel between March 2020 and May 2020.
But in the following years, it rolled back the Rs 13 and Rs 16 per litre excise duty hike as international oil prices soared, the PTI reported.
(with PTI inputs)
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