War: Threat to India's economy!!!!

After Russia's attack on ukraine (world war 3), benchmark Brent crude oil futures have touched $100 per barrel after 7 years. For the first time since 2014, oil prices have reached $100 per barrel. You will get to see the effect of expensive crude oil not only at the petrol pump but also in your daily life.

Petrol and diesel price cut

On november 3, the Modi government had cut the excise duty on petrol and diesel by Rs 5 and Rs 10. During this, many state governments also reduced VAT. However, it is very important for you to know that tax on petroleum products is a big source of income for the state and central governments. Petroleum products are taxed at a high rate in India, the rate of which is much higher than in our neighboring countries.

Tax rate review

In order to give relief to the general public from the rising prices of petrol and diesel, the central government and the State Governments will have to review the tax rate. It is worth noting that the central government imposes a tax called Excise Duty and State Governments VAT on petroleum products. In such a situation, the income of both the state and central governments will be adversely affected. In this situation, the governments can cut the expenditure in their development works.

Finance minister Nirmala Sitharaman told the rajya sabha that from the Central Excise Duty on petrol and diesel, the central government earned Rs 2,10,282 crore in the financial year 2019, Rs 2,19,750 crore in 2020, and Rs 3,71,908 crore in 2021.