Petrol and diesel prices are skyrocketing but the five states facing assembly elections may bring some sort of relief for the consumers across the country. The central government is planning to reduce tax on fuel ahead of elections in West Bengal, Assam, Kerala, Tamil Nadu, and Puducherry.
The model code of conduct for these assembly elections came into effect on February 26th but because the reduction in taxes is a national-level decision, the Election Commission may not object to it. The Center, however, cannot advertise tax reductions in the states going to polls.
Petrol prices incur 60% taxes from the Center and the States. Any significant price reduction will require actions from the center, states, and the oil marketing companies. That’s the only way to offer relief of at least Rs. 4-5 per litre.
OPEC+ (Organization of Petroleum Exporting Countries) recently decided not to increase the oil output. This decision led to a 5% jump in crude oil price and we shouldn’t expect it to cool down anytime soon.