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Excise duty cut on petrol, diesel will have an impact of Rs 45,000 crore on the exchequer: Report

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Excise duty cut on petrol, diesel will have an impact of Rs 45,000 crore on the exchequer: Report

Mumbai, Nov 4 (PTI) The cut in excise duty on diesel and petrol will impact the exchequer by Rs 45,000 crore and increase the Centre’s fiscal deficit by 0.3 per cent. This was stated in the report of a foreign brokerage company released on Thursday.

Economists at Japanese brokerage company Nomura said in a report that in terms of aggregate consumption, this surprise move would impact the exchequer by Rs 1 lakh crore, which would be 0.45 per cent of the gross domestic product (GDP), for the full fiscal year.

For the remaining months of the current financial year, there will be an impact of Rs 45,000 crore on the exchequer, which will increase the fiscal deficit.

The brokerage said it now expects the fiscal deficit to come down to 6.5 per cent as against the earlier estimate of 6.2 per cent and underlined that it will still remain short of the target of 6.8 per cent.

The central government on Wednesday announced a reduction in excise duty on petrol by Rs 5 per liter and on diesel by Rs 10 per liter on the eve of Diwali.

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