The Great Indian Fuel Tax Trick: How government is now eyeing a $21-billion windfall
NEW DELHI: The Centre’s steep tax hike on petrol and diesel may net it a cool Rs 1.7 lakh crore in additional tax revenue this fiscal, if the increase is maintained for the full year (FY2020-22). On the flipside, Indians now rank among the world’s most taxed consumers of transport fuel — Central and state taxes accounted for over 69% of retail fuel prices in the national capital on May 6, handily beating even highly-taxed European economies.
Tuesday’s tax hike absorbs most of the gain from all-time low crude oil prices instead of passing on the benefit to the consumer. It will also almost double Central fuel tax collections from the Rs 2-odd lakh crore expected in 2019-20.
