Branded Diesel Excise Duty Charged to 14% + Rs. 5/Ltr or Rs. 10.25 per Ltr, Whichever is Lower

[Central Excise Notification No. 04 dated 30^th January 2015]

The government has changed the excise duty structure on branded or premium diesel, shifting from fixed rates to a combination of ad valorem and fixed duty.

Branded diesel will now be charged at 14 per cent of refinery gate price of the fuel plus Rs 5 per litre or Rs 10.25, whichever is lower, according to notification issued by Department of Revenue in the Finance Ministry.

The duty shift will not result in any change in retail price as the notification stated that the fuel will be charged with a duty of "14 per cent plus Rs 5 per litre or Rs 10.25 per litre, whichever is lower".

The fuel, which is sold under brands 'XtraMile' by Indian Oil Corp (IOC), 'Hi speed Diesel' by Bharat Petroleum Corp Ltd (BPCL) and 'Diesel Super' and 'Turbo Jet' by Hindustan Petroleum Corp Ltd (HPCL), till now attracted a total excise duty of Rs 10.25 per litre.

The specific excise duty rates for unbranded or normal diesel as well as unbranded and branded petrol have not been changed and they will continue to be charged at specific rates.

In exercise of the powers conferred by sub-section (1) of section 5A of the Central Excise Act, 1944 (1 of 1944), the Central Government, being satisfied that it is necessary in the public interest so to do, hereby makes the following further amendment in the notification of the Government of India in the Ministry of Finance (Department of Revenue), No.12/2012-Central Excise, dated the 17^th March, 2012, published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i) vide G.S.R. 163(E), dated the 17^th March, 2012, namely: -

In the said notification, in the Table, in serial number 71, against item (ii) of column (3), for the entry in column (4), the entry “14% + ` 5.00 per litre or ` 10.25 per litre, whichever is lower” shall be substituted.

[F. No.354/123/2014-TRU]