According to CNBC – TV18 report, the government is not planning to cut excise duty on the fuel products as of now, due to the fiscal concerns.
Source familiar to the matter informed to the news channel that additional expenditure for FY22 at the time of revised estimates of the budget is likely expected.
The report further stated that a Rs 10 reduction in the fuel excise duty will impact fiscal deficit by around 0.58 per cent and the cool inflation by only 0.2 per cent.
The Centre, in a written reply to the Rajya Sabha, explained that the excise duty on petrol and diesel have been calibrated to generate resources for infrastructure building and other developmental expenditure.
Pankaj Chaudhury, Minister of State for Finance said, “The government is making concerted efforts to raise resources for infrastructure and other developmental items of expenditure, the details of which were announced in the annual budget. The excise duty rates on petrol and diesel have been calibrated to generate these resources keeping in view the prevailing fiscal situation. VAT on petrol and diesel are levied by states.”
Meanwhile, an additional expenditure on COVID 19 vaccination is estimated at around Rs 5000- Rs 6000 crore, leading the vaccine budget to Rs 40,000 crore – Rs 41,000 crore .
