Fuel prices set to rise further due to high taxes, hints IOC chief | India News – Times of India
NEW DELHI: Fuel prices are likely to be raised further to close the gap between domestic pump prices and international benchmarks but high taxes are pushing rates to record levels, Sanjiv Singh, chairman of India’s largest refiner-retailer, IndianOil, said on Wednesday.
Singh’s comment came on the day diesel, at Rs 79.88 a litre, became costlier than petrol by 12 paise Delhi after the retailers raised its price for the 18th consecutive. Petrol price was left alone after increasing it for 17 days. This is the first time-ever that diesel, consumed by transporters and farmers, has overtaken petrol anywhere in India.
“The Delhi government had increased VAT on petrol from 27% to 30% and that on diesel from 16.75% to 30% on May 5. This massive hike in VAT resulted in rates going up by Rs 1.67 per litre for petrol and by a record Rs 7.10 for diesel on a single day,” Singh said in reference to how high taxes amplify the impact of revisions in base prices. Singh said the companies resumed daily price revisions after international markets stabilised. This included passing on the excise duty increase. “While we had negative cracks (margins or difference between crude and refined product prices), individual states raised VAT and central excise was hiked.” he said.