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Why new farm cess on fuel won’t pinch pockets of consumers

Feb 01, 2021 21:18 IST

The government has imposed an Agriculture Infrastructure and Development Cess of ₹2.5 per litre on petrol and ₹4 per litre on diesel. But will this cess result in any additional burden on consumers. The answer is a no as unbranded petrol was attracting a basic excise duty of ₹2.98 and a special additional excise duty of ₹12 per litre. These have now been reduced to ₹1.4 and ₹11 per litre. Similarly, the basic excise duty on unbranded diesel has been cut from ₹4.83 to ₹1.8 and the special adjustment excise duty on it from ₹9 to ₹8 per litre. So, the overall excise incidence on petrol will now be ₹14.9/litre, which was previously ₹14.98, while that on diesel is ₹13.8 as compared to ₹13.83 earlier.

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