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Govt of India has reduced Basic Excise Duty rate on Petrol & Diesel [both branded and unbranded] by Rs. 2 per litre w.e.f. 4th October,2017 — Ministry of Finance (@FinMinIndia) 1507038171000

This has been done to cushion the impact of rising international prices of crude petroleum oil & petrol & diesel on their Retail Sale Prices — Ministry of Finance (@FinMinIndia) 1507038416000

Revenue loss on a/c of these reductions in excise duty is about Rs.26,000 crore in full year& Rs13,000 crore in remaining part of Current FY — Ministry of Finance (@FinMinIndia) 1507038732000

This decision has also been taken by the Government of India in order to protect the interest of common man. — Ministry of Finance (@FinMinIndia) 1507038760000

NEW DELHI: The government has slashed the excise duty on petrol and diesel by Rs 2 per litre . The new rate will come into effect from midnight."Govt of India has reduced Basic Excise Duty rate on Petrol & Diesel (both branded and unbranded) by Rs 2 per litre w.e.f. 4th October, 2017," the finance ministry said in a tweet on Tuesday.This has been done to cushion the impact of rising international prices of crude petroleum oil and petrol and diesel on their Retail Sale Prices, it added.The ministry said the exchequer will bear a revenue loss Rs 26,000 crore as a result of this reduction in excise duty. But the decision was taken to safeguard the "interest of common man"."Revenue loss on account of these reductions in excise duty is about Rs 26,000 crore in full year and Rs13,000 crore in remaining part of Current FY. This decision has also been taken by the Government of India in order to protect the interest of common man," the finance ministry said.The move comes at a time when the retail selling price of petrol has crossed Rs 70 in most states, while the price of diesel is close to Rs 60.Crude oil prices have jumped nearly 12 per cent between September 1 to 25 to reach $59 a barrel before slipping to $56 on Monday. Indian consumers have to pay a fuel price that is linked to international rates and topped with heavy central and state taxes. Prices are revised daily and are the average of the preceding 15 days’ international rates.The government has also been facing increasing pressure to bring petroleum products under the ambit of the Goods and Services Tax (GST). While there is no legal hurdle to including petrol and diesel under GST as the GST Council has already listed them under the new tax regime, the Centre and states appear reluctant to do so, given that taxation of petroleum products is a major source of revenue.Currently, consumers pay three major taxes on petrol. These taxes include Excise Duty (charged by the centre), VAT or Value Added Tax (charged by respective states) and the dealers' commission.Data shared by the government indicates that the excise duty on diesel increased by over 380 per cent since the BJP came to power, while it increased by over 120 per cent in the case of petrol. Central government revenue through levy of excise duty on petrol/diesel has more than tripled in the three year period between 2013-14 and 2016-17 owing to this increase in tax rate.