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No cut in excise duty on petrol, diesel for now; have to pay for past oil bonds: FM Sitharaman

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Finance Minister Nirmala Sitharaman on Monday said that there will be no cut in excise duty on fuel as of now. She said the previous UPA government had reduced fuel prices by issuing Oil Bonds of ₹1.44 lakh crore. “I can’t go by the trickery that was played by previous UPA government.

Due to Oil Bonds, the burden has come to our government, that’s why we are unable to reduce prices of petrol and diesel,” she added. The UPA government had issued bonds to state-owned oil companies to make up for the difference in the artificially suppressed retail selling price of fuel and the cost. These oil bonds and the interest thereon are being paid now.

The finance minister said that exchequer is burdened by interest payments being made for oil bonds floated by the Congress-led UPA government. The government has paid over 70,195.72 crore in interest in the last 5 years on oil bonds itself.

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However, central leaders have on many occasion defended current tax on petrol and diesel, saying the government needs money to fund several schemes and build infrastructure. Excise duty on petrol has been raised from ₹9.48 per litre in 2014 to ₹32.90 a litre now while the same on diesel has gone up from ₹3.56 a litre to ₹31.80.

News Source : Business Standard

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