Petroleum minister Veerappa Moily is pushing the finance ministry for a cut in duties on branded petrol and diesel. The ministry, at present, levies higher excise duty on branded petrol and diesel, making them costlier than unbranded fuel.
While a litre of regular/normal or unbranded petrol costs R72.45 in Delhi, branded petrol is priced at R81.88. Normal diesel in Delhi costs R52.54 a litre, while branded diesel costs R67.93.
The finance ministry, in the 2009 Budget, introduced new duties on branded fuels. In September last year, the government stopped providing subsidy on branded fuel. This led to a dip in the sales of branded fuels. The government levies an excise duty of R1.20 a litre on normal or unbranded petrol while the same on branded petrol is R7.50. Similarly, unbranded diesel attracts an excise duty of R1.46 per litre while R3.75 duty is levied on branded diesel. The current unbranded or normal diesel price of R52.54 a litre includes a subsidy of R9.20.
Moily said the cut in excise duty by R6.30/litre on petrol and R2.29 on diesel would help in conservation as these fuels provide improved engine performance to yield 2% savings in consumption.