Duty on petrol and diesel to shore up domestic supplies; customs duty on gold raised
According to the Ministry of Finance, a cess of Rs 6 per litre has been imposed on exports of petrol and ATF each while one of Rs 13 per litre has been imposed on diesel. Besides, since the domestic crude producers are making windfall gains, a cess of Rs 23,250 per tonne has been imposed on crude.
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The government has imposed special additional excise duty (SAED)/cesses on exports of petrol, diesel and Aviation Turbine Fuel (ATF). According to a press release from the Ministry of Finance, a cess of Rs 6 per litre has been imposed on exports of petrol and ATF each while one of Rs 13 per litre has been imposed on diesel. Besides, since the domestic crude producers are making windfall gains, a cess of Rs 23,250 per tonne has been imposed on crude.
The levy on crude, which follows record earnings by Oil and Natural Gas Corporation (ONGC), Oil India Ltd (OIL), Cairn Oil & Gas of Vedanta Ltd, alone will fetch the government Rs 67,425 crore annually on approximately 3 crore tonnes of crude oil produced domestically.
The restriction on export is also aimed at shoring up domestic supplies at petrol pumps. There were reports of some of them having dried up as private refiners preferred exporting fuel than selling it locally. The export tax follows oil refiners, particularly Reliance Industries and Rosneft-backed Nayara Energy, making a killing in exporting fuel to deficit regions such as Europe and the US in the aftermath of Russia's invasion of Ukraine.
Increase of customs duty on gold
The customs duty on gold has been increased from the present 10.75 per cent to 15 per cent to curb its imports. India has raised basic import duty on gold to 12.5 per cent from 7.5 per cent, according to a government notice dated June 30. Along with the agriculture infrastructure development cess (AIDC) of 2.5 per cent, the effective gold customs duty will be 15 per cent.
"There has been a sudden surge in imports of gold. In the month of May, a total of 107 tonnes of gold was imported and in June also the imports have been significant. The surge in gold imports is putting pressure on the current account deficit," The Finance Ministry said. The rupee has reached a record low of 79 per dollar.
