During the Union Budget 2021, the finance minister (FM) - Nirmala Sitharaman has proposed an agricultural, infrastructure and development cess on the fuel of Rs 2.5 on petrol and Rs 4 on diesel. Despite imposition of cess, the prices of petrol and diesel the consumers need not have to pay extra prices, clarifies FM.
This will be applicable from February 2, 2021.
The prices of petrol and diesel will be revised daily at 6:00 am in India, by the state-run oil marketing company - Indian Oil Corporation Limited. The prices will be revised in line with the change in crude prices in the overseas markets and the revision of the currency exchange rate.
The Finance Minister noted that such a cess will not affect consumers and added that "Consequent to the imposition of Agriculture Infrastructure and Development Cess (AIDC) on petrol and diesel, Basic excise duty (BED) and Special Additional Excise Duty (SAED) rates have been reduced on them so that overall consumer does not bear any additional burden."
She further added, "Consequently, unbranded petrol and diesel will attract basic excise duty of Rs 1.4, and Rs 1.8 per litre respectively. The SAED on unbranded petrol and diesel shall be Rs 11 and Rs 8 per litre respectively. Similar changes have also been made for branded petrol and diesel."
Apart from the imposition of the agricultural cess on fuel, it was also applied on several other goods like 2.5% on gold and silver bars, 20% on crude soybean, sunflower oil, 100% cess on alcohol, 17.5% cess on crude palm oil, 40% on peas and 35% on apples.