In a slew of duty tweaks, the central government today hiked import duty on gold to 15% from 10.75% currently to ease pressure on the current account deficit (CAD) due to surging gold imports. The Centre also imposed special additional excise duty of ₹6 per litre on exports of petrol and ₹13 per litre on exports of diesel. The special additional excise duty of ₹6 per litre has been imposed on the exports of aviation turbine fuel too.
A notification issued by the finance ministry says a cess of ₹23,250 per tonne by way of special additional excise duty-SAED has been imposed on crude.
Even as the finance ministry remains silent on the additional revenue these tweaks will rake in, it points out that these measures will not impact the domestic prices of petrol, diesel and ATF (aviation turbine fuel).
On hiking gold import duty, the ministry says the move has been prompted by a sudden surge in gold imports, which touched 107 tonnes in May.
Explaning the export cess on petrol and diesel, the ministry says: “While crude prices have increased sharply in recent months, the prices of high-speed diesel and petrol have shown a sharper increase. The refiners export these products at globally prevailing prices, which are very high. As exports are becoming highly remunerative, it has been seen that certain refiners are drying out their pumps in the domestic market.”
“In view of this, cesses equal to ₹6 per litre on petrol and ₹13 per litre on diesel have been imposed on their exports,” the ministry adds. With the same reasoning, cess on ATF, too, has been imposed.
The cesses would apply to any export of diesel and petrol from the country, the ministry says. It adds that since these measures apply to exports, there will not be any implication on the domestic retail prices of diesel and petrol.
In order to ensure domestic fuel supply amid the global disruptions, the Directorate General of Foreign Trade (DGFT), too, has imposed export policy conditions, which at the time of exports require exporters to declare that 50% of the quantity mentioned in the shipping bill has been or will be supplied in the domestic market during the current financial year.
“These measures would not have any adverse impact on domestic retail prices of diesel and petrol. Thus, domestic retail prices would remain unchanged. At the same time, these measures will ensure domestic availability of the petroleum products,” says the ministry.
“Crude prices have risen sharply in recent months. The domestic crude producers sell crude to domestic refineries at international parity prices. As a result, domestic crude producers are making windfall gains. Taking this into account, a cess of ₹23,250 per tonne has been imposed on crude. Import of crude would not be subject to this cess,” it says.