Between 2014–15 and 2021–22, the excise duty on gasoline increased by a staggering 194%, while the excise duty on diesel increased by a staggering 512%, burdening the average person when crude oil prices stayed below $80 per barrel between 2015–16 and 2021–22.
Between 2014–15 and 2021–22, the government's revenue generating through the imposition of excise duty increased by 126%. The gain in income at that time was 186%. In 2014–15, when the NDA government took office, the excise duty on gasoline was Rs 9.48 per litre and on diesel it was Rs 3.56 per litre, according to official data published by the Petroleum Ministry's Petroleum Planning and Analysis Cell (PPAC).
Excise taxes on gasoline increased by 194% to Rs 27.90 per litre in 2021–2022 and by 512% to Rs 21.80 per litre on diesel. t's interesting to note that between 2015–16 and 2021–22, crude oil prices stayed stable but excise taxes on gasoline and diesel increased steadily. persistently below $80 per barrel, and on three occasions even fell below the $50 threshold.
While the price of crude oil was $84.16 per barrel in 2014–15, it dropped significantly to $46 per barrel in 2015–16 and $47 per barrel in 2016–17. A deeper look at the data reveals that the excise duty on gasoline increased from Rs 17.48 per litre to Rs 21.48 per litre between 2015–16 and 2016–17, even though crude oil prices were roughly half of what they were in 2014–15. Diesel excise duty increased from Rs. 10.26 to Rs. 17.33 per litre for the same time period.
Thus, during the year of 2015–17, when the price of crude oil was in the range of $46–$47 per barrel, the excise tax on gasoline and diesel increased by 22,9% and 68,2%, respectively.
Even in 2020–21, when the coronavirus pandemic started and crude oil prices dropped drastically to $44.82 per barrel from $60.47 per barrel in 2019–20, the excise duty on gasoline increased from Rs. 19.98 per litre on March 13, 2020 to Rs. 32.90 per litre on February 2, 2021. an increase of Rs 13 per litre in less time than a year. On March 13, 2020, the excise tax on diesel was Rs 15.83 per litre. However, it increased by Rs 16 on February 2, 2021, to reach Rs 31.80 per litre.
Between 2014–15 and 2021–22, the excise duty increased continuously (with the exception of a few cutbacks, such the one that took effect in November 2021), which resulted in a sharp increase in revenue of 186% for the government. The total amount contributed to the exchequer by this levy in 2014–15 was Rs 1,72,065 crore, and it will increase by 186% to reach Rs 4,92,303 crore in 2021–22.
During this time, this levy's revenue growth for the government increased by 126%. Excise taxes on gasoline and diesel brought in Rs 15,85,922 crore in income in 2014–15; by 2021–22, they will rise to Rs 35,95,813 crore.