NEW DELHI: Expect no relief on oil prices, as a day after the government ruled out any cut in excise duty, Finance Ministry said that it is unlikely to intervene in controlling petrol and diesel prices till the international crude oil prices breach 81 USD per barrel mark and crosses Rs 85 per litre in Delhi.
“The ministry is keeping a close watch on the movement of oil prices. The hike in oil prices is due to international factors, over which we do not have much control. We have factored in all the impact and unless it breaches the $81 per barrel mark, things are still under control and manageable. As far as it is under Rs 85 per litre in Delhi, there is no reason to panic,” a senior Finance Ministry official told TNIE.
The official further hinted that until they get a signal from the Prime Minister’s Office, they will stick to their fiscal discipline.
“Even during the UPA regime, when the international oil prices were high domestic fuel prices had soared. However, it is not just the Centre, even the states have the option to reduce VAT (Value Added Tax),” the official added.
On Wednesday, petrol was selling at Rs 79.31 per litre in Delhi, at Rs 86.72 in Mumbai, Rs 82.41 in Chennai and Rs 82.22 in Kolkata. Diesel was vending on Wednesday at a price of Rs 71.34 in Delhi, Rs 75.74 per litre in Mumbai, Rs 75.39 per litre in Chennai and Rs 74.19 per litre in Kolkata.
While the Centre currently levies a total of Rs 19.48 per litre excise duty on petrol and Rs 15.33 per litre on diesel, states too levy VAT, which is why prices vary across metros. Prices in Delhi are the cheapest in all metros, due to lower VAT.
The official also ruled out the inclusion of Aviation Turbine Fuel (ATF) under Goods and Services Tax (GST) at this stage. “Ultimately it (ATF) will come under the GST, but the process will be gradual. So, it is unlikely to happen anytime sooner,” he said.
On several occasions, the aviation sector had requested the Finance Ministry to bring the ATF under GST, as most of the airlines were reeling under severe financial crunch, mainly due to high oil prices.