Unable to bite the bullet on diesel subsidies, the finance ministry is now looking to raise excise duty on vehicles using the subsidised fuel to discourage consumption of the fuel and bolster its tax revenues.
Car buyers have been making a beeline for diesel cars and there exists a waiting period of 2-3 months for most diesel models. The government, facing flak for increase in petrol prices, has been unable to muster political courage to deregulate diesel prices to contain its subsidy bill.
The proposal had been mooted by the petroleum and natural gas ministry ahead of the budget but the finance ministry opted for an across-the-board increase of 2% in excise duty to 12% instead.
The petroleum ministry has for long argued that the rich should not get subsidised fuel. According to ministry estimates, 15% of diesel consumption is accounted for by personal cars and SUVs.
....more info
Car buyers have been making a beeline for diesel cars and there exists a waiting period of 2-3 months for most diesel models. The government, facing flak for increase in petrol prices, has been unable to muster political courage to deregulate diesel prices to contain its subsidy bill.
The proposal had been mooted by the petroleum and natural gas ministry ahead of the budget but the finance ministry opted for an across-the-board increase of 2% in excise duty to 12% instead.
The petroleum ministry has for long argued that the rich should not get subsidised fuel. According to ministry estimates, 15% of diesel consumption is accounted for by personal cars and SUVs.
....more info