New Delhi:
The government has postponed by one month the levy of an additional Rs 2 per liter of excise duty on non-ethanol-doped petrol and six months on diesel not blended with biodiesel.
The government has relaxed the deadline for the delivery of ethanol-blended gasoline to avoid the additional tax until November 2022 and that for the delivery of biodiesel-doped diesel until April 2023, in an effort to give the industry more time to pass the oil import restriction. to feed.
The Ministry of Finance states in a Government Gazette published late on Friday 30 September that the extra excise duty on petrol will be levied from November 1, 2022 and on diesel from April 2023.
Union Finance Minister Nirmala Sitharaman had introduced an additional levy of Rs 2 per liter on petrol and diesel that is not blended with ethanol and biodiesel in her budget for the fiscal year starting in April 2022. This tax would apply from October 1, 2022, but has now been shifted to November 1 for petrol and April 1, 2023 for diesel.
Currently, 10 percent ethanol, extracted from sugar cane or surplus food grain, is blended or blended into gasoline (ie, 10 percent ethanol blended with 90 percent gasoline) to reduce dependence on oil imports and provide farmers with an additional source of income.
This prevents additional excise duties from being levied on petrol.
But there is only an experimental blend of biodiesel, extracted from inedible oilseeds, into diesel – the most widely used fuel in the country.
“Fuel blending is a priority of this government. To encourage fuel blending efforts, unmixed fuel will be subject to an additional differential excise tax of Rs 2 per liter from October 1, 2022,” Sitharaman said in her budget speech. declared. in the Lok Sabha on February 1.
In its Sept. 30 notice, its ministry stated that “gasoline intended for retail sale, not so blended with ethanol or methanol” will attract Rs 3.40 per liter of basic excise duty from Nov. 1, 2022, instead of Rs. 1.40 per liter currently.
Branded gasoline, not doped with ethanol, will attract Rs 4.60 per liter of excise duty, up from Rs 2.60 currently.
In the case of diesel, it said the fuel “intended for retail sale, not so blended with alkyl esters of long-chain fatty acids derived from vegetable oils, commonly known as biodiesel” will attract rupees 3.80 per liter of basic excise duty. instead of €1.80. Branded diesel will attract Rs 6.20 per liter of basic excise tax against Rs 4.20 currently.
In addition to the basic excise duty, petrol and diesel are also subject to an assignment and special additional excise duty. The total excise duty on petrol is Rs 19.90 per liter and that on diesel is up to Rs 15.80.
While the additional tax will encourage oil companies to buy more ethanol for blending gasoline and manage logistics for transportation to deficient areas, the country is unlikely to be able to build infrastructure for biodiesel production. at the scale needed for blending into diesel, industry officials said.
Last year, the government pushed forward its target of achieving 20 percent blending of ethanol with gasoline to 2025, five years ahead of the previous target, to help reduce its dependence on expensive oil imports. Earlier this year, 10 percent ethanol blending was achieved.
India is the third largest oil importer in the world, relying on foreign suppliers to meet more than 85 percent of its demand.
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