New Delhi: State-owned oil companies – the Indian Oil Corporation, the Bharat Petroleum Corporation and the Hindustan Petroleum Corporation — in June last year dumped the 15-year old practice of revising rates on the 1st and 16th of every month. Instead, they adopted a daily price revision system to instantly reflect changes in cost. Since then, prices are revised on a daily basis. On Sunday, the oil firms raised petrol and diesel rates by 18 paise per litre in Delhi.
So, petrol price has increased in Delhi from last month’s average of Rs. 72.45 to Rs 73.73. It is the highest since September 14, 2014, when rates had hit Rs 76.06; diesel price is highest ever at Rs 64.58, the previous high being Rs 64.22 on February 7. The price spiral has led to renewing of calls for the government to cut excise tax rates. Arun Jaitley had raised excise duty nine times between November 2014 and January 2016 to boost the financial sector as oil prices went down, however, he cut the tax once by Rs 2 per litre in October 2017.
Subsequently, the centre also asked the states to reduce VAT, but only four states that include Maharashtra, Gujarat, Madhya Pradesh and Himachal Pradesh implemented the call, as per reports in a leading daily. Last year, the central government had cut excise duty by Rs 2 per litre in October 2017, when petrol price reached Rs 70.88 per litre in Delhi and diesel Rs. 59.14. After reduction in excise duty, diesel prices came down to Rs 56.89 per litre and petrol to Rs 68.38 per litre on October 4, 2017. India has the highest retail prices of petrol and diesel among South Asian nations as taxes account for half of the pump rates.