States' petro revenues surpass Centre's 1st time

Riding on an ad valorem taxation structure, state governments have for the first time collected more revenue on petroleum products than the Centre. The states together collected Rs 112,889 crore petroleum revenue in FY12 (up 27 per cent from FY11) while the Centre collected Rs 83,723 crore, down 19 per cent from FY11 due to a reduction in diesel excise and elimination of customs duty on crude oil in June last year, according to data with the Petroleum Products Planning and Analysis Cell, a wing of the petroleum ministry.

The central government’s customs duty on petroleum products declined 59 per cent in FY12 to Rs 10,013 crore. This was, as mentioned, mainly due to elimination of customs duty on crude oil and reduction in customs duty on petroleum products by five per cent in June last year. Similarly, the collection of excise duty on petroleum products declined from Rs 68,040 crore in FY11 to Rs 61,954 crore in FY12, mainly due to reduction in in June last year, said a official.

State governments levy sales tax or value added tax on petrol, from 15 per cent in Puducherry to 33 per cent in Andhra Pradesh, making it a major source of income. By contrast, the excise duty imposed by the Union government is specific at Rs 14.35 a litre, exclusive of a three per cent cess. More, in June last year, the Centre removed the five per cent customs duty on crude oil, brought down the import duty on petrol and diesel from 7.5 per cent to 2.5 per cent and reduced the excise duty on diesel from Rs 4.60 to Rs 2.60 per litre. In the case of ATF, too, states charge ad valorem tax that comes to an average 24 per cent. A sharp increase in prices of both petrol and aviation turbine fuel meant more revenue for states. Among the latter, the highest petroleum tax levy last year was collected by Maharashtra at Rs 14,815 crore, followed by Gujarat (Rs 10,412 crore) and Andhra Pradesh (Rs 9,538 crore).



The decline in the central government's revenues from petroleum products came at a time when its subsidy outgo to its three oil marketing companies — Indian Oil, Bharat Petroleum and Hindustan Petroleum — stood at a record Rs 83,500 crore or 60.27 per cent of the gross under-recovery of Rs 138,541 crore during 2011-12. The three companies sell diesel, kerosene and domestic cooking gas at a government regulated price and a loss, compensated through a cash subsidy from the government and discounts on crude oil by Oil and Natural Gas Corporation and Oil India.

image
Business Standard
177 22
Business Standard

States' petro revenues surpass Centre's 1st time

Ajay Modi  |  New Delhi 



Riding on an ad valorem taxation structure, state governments have for the first time collected more revenue on petroleum products than the Centre. The states together collected Rs 112,889 crore petroleum revenue in FY12 (up 27 per cent from FY11) while the Centre collected Rs 83,723 crore, down 19 per cent from FY11 due to a reduction in diesel excise and elimination of customs duty on crude oil in June last year, according to data with the Petroleum Products Planning and Analysis Cell, a wing of the petroleum ministry.

The central government’s customs duty on petroleum products declined 59 per cent in FY12 to Rs 10,013 crore. This was, as mentioned, mainly due to elimination of customs duty on crude oil and reduction in customs duty on petroleum products by five per cent in June last year. Similarly, the collection of excise duty on petroleum products declined from Rs 68,040 crore in FY11 to Rs 61,954 crore in FY12, mainly due to reduction in in June last year, said a official.

State governments levy sales tax or value added tax on petrol, from 15 per cent in Puducherry to 33 per cent in Andhra Pradesh, making it a major source of income. By contrast, the excise duty imposed by the Union government is specific at Rs 14.35 a litre, exclusive of a three per cent cess. More, in June last year, the Centre removed the five per cent customs duty on crude oil, brought down the import duty on petrol and diesel from 7.5 per cent to 2.5 per cent and reduced the excise duty on diesel from Rs 4.60 to Rs 2.60 per litre. In the case of ATF, too, states charge ad valorem tax that comes to an average 24 per cent. A sharp increase in prices of both petrol and aviation turbine fuel meant more revenue for states. Among the latter, the highest petroleum tax levy last year was collected by Maharashtra at Rs 14,815 crore, followed by Gujarat (Rs 10,412 crore) and Andhra Pradesh (Rs 9,538 crore).



The decline in the central government's revenues from petroleum products came at a time when its subsidy outgo to its three oil marketing companies — Indian Oil, Bharat Petroleum and Hindustan Petroleum — stood at a record Rs 83,500 crore or 60.27 per cent of the gross under-recovery of Rs 138,541 crore during 2011-12. The three companies sell diesel, kerosene and domestic cooking gas at a government regulated price and a loss, compensated through a cash subsidy from the government and discounts on crude oil by Oil and Natural Gas Corporation and Oil India.

RECOMMENDED FOR YOU

States' petro revenues surpass Centre's 1st time

Riding on an ad valorem taxation structure, state governments have for the first time collected more revenue on petroleum products than the Centre.

Riding on an ad valorem taxation structure, state governments have for the first time collected more revenue on petroleum products than the Centre. The states together collected Rs 112,889 crore petroleum revenue in FY12 (up 27 per cent from FY11) while the Centre collected Rs 83,723 crore, down 19 per cent from FY11 due to a reduction in diesel excise and elimination of customs duty on crude oil in June last year, according to data with the Petroleum Products Planning and Analysis Cell, a wing of the petroleum ministry.

The central government’s customs duty on petroleum products declined 59 per cent in FY12 to Rs 10,013 crore. This was, as mentioned, mainly due to elimination of customs duty on crude oil and reduction in customs duty on petroleum products by five per cent in June last year. Similarly, the collection of excise duty on petroleum products declined from Rs 68,040 crore in FY11 to Rs 61,954 crore in FY12, mainly due to reduction in in June last year, said a official.

State governments levy sales tax or value added tax on petrol, from 15 per cent in Puducherry to 33 per cent in Andhra Pradesh, making it a major source of income. By contrast, the excise duty imposed by the Union government is specific at Rs 14.35 a litre, exclusive of a three per cent cess. More, in June last year, the Centre removed the five per cent customs duty on crude oil, brought down the import duty on petrol and diesel from 7.5 per cent to 2.5 per cent and reduced the excise duty on diesel from Rs 4.60 to Rs 2.60 per litre. In the case of ATF, too, states charge ad valorem tax that comes to an average 24 per cent. A sharp increase in prices of both petrol and aviation turbine fuel meant more revenue for states. Among the latter, the highest petroleum tax levy last year was collected by Maharashtra at Rs 14,815 crore, followed by Gujarat (Rs 10,412 crore) and Andhra Pradesh (Rs 9,538 crore).



The decline in the central government's revenues from petroleum products came at a time when its subsidy outgo to its three oil marketing companies — Indian Oil, Bharat Petroleum and Hindustan Petroleum — stood at a record Rs 83,500 crore or 60.27 per cent of the gross under-recovery of Rs 138,541 crore during 2011-12. The three companies sell diesel, kerosene and domestic cooking gas at a government regulated price and a loss, compensated through a cash subsidy from the government and discounts on crude oil by Oil and Natural Gas Corporation and Oil India.

image
Business Standard
177 22

More News

  • India's GDP numbers for first quarter later on Wednesday India's GDP numbers for first quarter later on Wednesday
  • Anil Agarwal Odisha to offer bauxite for Lanjigarh refinery by March 2017: Anil Agarwal
Widgets Magazine

Widgets Magazine

Upgrade To Premium Services

Welcome User

Business Standard is happy to inform you of the launch of "Business Standard Premium Services"

As a premium subscriber you get an across device unfettered access to a range of services which include:

  • Access Exclusive content - articles, features & opinion pieces
  • Weekly Industry/Genre specific newsletters - Choose multiple industries/genres
  • Access to 17 plus years of content archives
  • Set Stock price alerts for your portfolio and watch list and get them delivered to your e-mail box
  • End of day news alerts on 5 companies (via email)
  • NEW: Get seamless access to WSJ.com at a great price. No additional sign-up required.
 

Premium Services

In Partnership with

 

Dear Guest,

 

Welcome to the premium services of Business Standard brought to you courtesy FIS.
Kindly visit the Manage my subscription page to discover the benefits of this programme.

Enjoy Reading!
Team Business Standard