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.