Govt’s excise mop-up from petrol, diesel doubles to Rs 3.7 lakh crore in FY21; states get Rs 20,000 crore

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NEW DELHI: The central government’s mop-up from excise duty levied on petrol and diesel more than doubled to Rs 3.72 lakh crore in the pandemic year 2020-21, out of which states were given less than Rs 20,000 crore, according to a reply by the government in the Rajya Sabha on Tuesday.
Minister of state for finance Pankaj Chaudhary in a written reply to a question stated that collection from levy of central excise duty on petrol and diesel increased from Rs 1.78 lakh crore in 2019-20 to Rs 3.72 lakh crore in 2020-21 (April 2020 to March 2021).
The increase in the collection was mainly on account of rise in the incidence of taxation on fuels.
Total excise duty on petrol was Rs 19.98 per litre in 2019 and Rs 15.83 a litre on diesel. The government raised excise duty twice last year to Rs 32.98 per litre on petrol and to Rs 31.83 on diesel.
The duty was moderated to Rs 32.90 a litre on petrol and Rs 31.80 on diesel in the budget this year. And it was cut by Rs 5 a litre on petrol and Rs 10 per litre on diesel this month after retail prices jumped to record high across the country.
“The total amount of tax devolved to state governments from the corpus collected under the central excise duty in FY 2020-21 was Rs 19,972 crore,” Chaudhary said.
While the total incidence of excise on petrol currently is Rs 27.90 a litre and that on diesel is Rs 21.80, states are entitled to get a share only from the basic excise duty.
Out of the total incidence of taxation, the basic excise duty on petrol is Rs 1.40 a litre. On top of this, special additional excise duty is levied of Rs 11 and a road and infrastructure cess of Rs 13 a litre. A Rs 2.50 agriculture infrastructure and development cess is levied on top of this.
Similarly, on diesel, the basic excise duty is Rs 1.80 a litre. Rs 8 per litre each is charged as special additional excise duty and road and infrastructure cess while a Rs 4 per litre agriculture infrastructure and development cess is also levied.
“Devolution to state governments is made out of the basic excise duty component on the basis of the formula prescribed by the Finance Commission from time to time. At present, the rate of basic excise duty is Rs 1.40 per litre on petrol and Rs 1.80 per litre on diesel,” he said.
Total excise collection from fuel was Rs 2.22 lakh crore in 2016-17, which inched up to Rs 2.25 lakh crore in the following year but fell to Rs 2.13 lakh crore in 2018-19.
Petrol and diesel is currently not under the Goods and Services Tax (GST) regime and states levy VAT on top of the excise duty charged by the centre.
“The total amount of tax collected under VAT on fuel across various states from April 2016 to March 2021 is Rs 9.57 lakh crore,” he said.
This compares to Rs 12.11 lakh crore collected by the central government during the same five year period, according to the minister’s reply.


NEW DELHI: The central government’s mop-up from excise duty levied on petrol and diesel more than doubled to Rs 3.72 lakh crore in the pandemic year 2020-21, out of which states were given less than Rs 20,000 crore, according to a reply by the government in the Rajya Sabha on Tuesday.
Minister of state for finance Pankaj Chaudhary in a written reply to a question stated that collection from levy of central excise duty on petrol and diesel increased from Rs 1.78 lakh crore in 2019-20 to Rs 3.72 lakh crore in 2020-21 (April 2020 to March 2021).
The increase in the collection was mainly on account of rise in the incidence of taxation on fuels.
Total excise duty on petrol was Rs 19.98 per litre in 2019 and Rs 15.83 a litre on diesel. The government raised excise duty twice last year to Rs 32.98 per litre on petrol and to Rs 31.83 on diesel.
The duty was moderated to Rs 32.90 a litre on petrol and Rs 31.80 on diesel in the budget this year. And it was cut by Rs 5 a litre on petrol and Rs 10 per litre on diesel this month after retail prices jumped to record high across the country.
“The total amount of tax devolved to state governments from the corpus collected under the central excise duty in FY 2020-21 was Rs 19,972 crore,” Chaudhary said.
While the total incidence of excise on petrol currently is Rs 27.90 a litre and that on diesel is Rs 21.80, states are entitled to get a share only from the basic excise duty.
Out of the total incidence of taxation, the basic excise duty on petrol is Rs 1.40 a litre. On top of this, special additional excise duty is levied of Rs 11 and a road and infrastructure cess of Rs 13 a litre. A Rs 2.50 agriculture infrastructure and development cess is levied on top of this.
Similarly, on diesel, the basic excise duty is Rs 1.80 a litre. Rs 8 per litre each is charged as special additional excise duty and road and infrastructure cess while a Rs 4 per litre agriculture infrastructure and development cess is also levied.
“Devolution to state governments is made out of the basic excise duty component on the basis of the formula prescribed by the Finance Commission from time to time. At present, the rate of basic excise duty is Rs 1.40 per litre on petrol and Rs 1.80 per litre on diesel,” he said.
Total excise collection from fuel was Rs 2.22 lakh crore in 2016-17, which inched up to Rs 2.25 lakh crore in the following year but fell to Rs 2.13 lakh crore in 2018-19.
Petrol and diesel is currently not under the Goods and Services Tax (GST) regime and states levy VAT on top of the excise duty charged by the centre.
“The total amount of tax collected under VAT on fuel across various states from April 2016 to March 2021 is Rs 9.57 lakh crore,” he said.
This compares to Rs 12.11 lakh crore collected by the central government during the same five year period, according to the minister’s reply.

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