Oil duty hike to shore up govt revenue by Rs 11,000 cr: Ind Ra

The excise duty hike on petrol and diesel by Rs 1.50 per litre will generate Rs 11,000 crore in additional revenue for the government this fiscal, India Ratings said today.
The decision to deregulate the diesel prices is expected to bring the oil subsidy down Rs 15,000 crore, the agency said, adding the ongoing correction in global crude prices will also result in sizable gains for the government.
Considering a tepid growth in indirect tax collections so far, coupled with the utilisation of over 80 per cent of the budgeted deficit in the first six months of FY15, this additional revenue will be a very helpful factor, it added.

"The government had budgeted a 20 per cent growth in indirect tax collections in FY15," it said.
The price of the Indian crude basket has fallen to USD 78.92 per barrel as on November 12 as against USD 84.77 per barrel on October 30, it said.
The government yesterday hiked excise duty on petrol and diesel prices by Rs 1.50 a litre each, saying it will mop up Rs 13,000 crore in additional revenue.

The fall in international oil prices had resulted in six consecutive reduction in petrol prices since August and two in diesel in the last one month.

Excise duty on normal or unbranded petrol was hiked from Rs 1.20 per litre to Rs 2.70 per litre and on unbranded diesel from Rs 1.46 a litre to Rs 2.96, the government said.
The same on branded petrol was raised from Rs 2.35 a litre to Rs 3.85 and on branded diesel from Rs 3.75 per litre to Rs 5.25.
While the excise duty hike will result in an immediate increase in both petrol and diesel prices, the expected reduction would keep the retail rates at almost the same levels.
There is also a possibility of state-owned oil firms advancing the planned review of fuel prices due on Saturday to make the whole exercise price-neutral for consumers.