Govt to suffer heavy loss in excise duty collection

The pan-Indian three-week lock down is likely to leave a major dent on the central and state government’s revenue on account of on jet fuel and auto fuel. Going by the consumption trend and the current excise duty of 22.98 on a litre of petrol and 18.83 on a litre of diesel, this loss could be as high as 16,000 cr for petrol and diesel alone. Owing to the suspension of air travel, losses from excise duty on aviation turbine fuel levied at 11% of its price will add heavily to the burden. The same is true of the state government. Delhi, for instance, levies a VAT of 14.79 per litre of petrol and 9.19 a litre on diesel at current prices.

The country is gearing up for a sharp economic slowdown in the March and June quarters as factories remained closed and consumer demand was at rock bottom. This comes at a time when the economy grew at 4.7% in the December quarter, its slowest pace in six years.

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