JOIN USClose on the heels of increasing excise duty on petrol and diesel, the government may now raise import duty on the crude oil to cash-in on crashing global crude prices.
The finance ministry is exploring possibilities of bringing back the levy and imposing it at the rate of 5 per cent. The 5 per cent import duty on crude oil was abolished in 2011 to cushion common man from higher pump prices of petrol and diesel when international oil prices hit the roof in that year.
The then UPA government had also cut the excise duty on diesel substantially. “But now once again the situation has emerged when there can be some decision on restoring importing duty. Various options on shoring up the government revenues are on the table. Import duty on crude may be one of them,” a government official told Deccan Herald.
The recent hike in excise duty on diesel and petrol is expected to earn the exchequer Rs 13000 crore.
The fall in crude oil price has enabled diesel prices to be decontrolled and there is no under-recovery on the fuel currently.
The subsidy on cooking gas and kerosene too has fallen substantially. At this juncture if the government decides to raise crude oil import duty, tax revenues will rise substantially.