Petrol, diesel prices hiked again on Monday

Gladys Abbott
September 10, 2018

Congress party led by Rahul Gandhi is staging a country-wide protest today, against the surging fuel prices under the Modi government.

Since 1 August, petrol prices have risen by Rs 4.42 per litre and diesel prices have risen by Rs 5.01 a litre in the national capital, on the back of a depreciating rupee against the dollar and an increase in global fuel prices. Two of them, rising price of crude oil and depreciation in the value of the rupee against the U.S. dollar, are beyond the control of government.

Post the price hike, non-branded petrol was priced at Rs 80.73 per litre in Delhi while diesel costs Rs 72.83 per litre - the highest ever prices recorded in the country's history.

Off late, the prices are on a northward journey for about a month now, baring a few days, when it dropped marginally.

On Tuesday, former Finance Minister P Chidambaram had stated that the "Relentless rise in prices of petrol and diesel is not inevitable".

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"Determining fares has become very complicated, especially in longer journeys. If taxes are cut, prices will decline significantly".

Since oil prices have started rising, following United States sanctions on Iraq and the slide of the rupee against the dollar, there have been calls to reduce tax.

But how much of the petrol price goes to the government as taxes? "So while industry and retail consumers are suffering, the government is increasing its tax revenue", said Patel. On top of this, states levy Value Added Tax (VAT) - the lowest being in Andaman and Nicobar Islands where 6 per cent sales tax is charged on both the fuels.

The VAT on petrol has been reduced from 30 to 26 per cent and from 22 to 18 per cent on diesel, Rajasthan Chief Minister Raje announced at a public gathering in Rawatsar in Hanumangarh district on Sunday.

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