The government is looking at one more hike in excise duty on petrol and diesel before March with a view to raising more revenue and stick to the fiscal deficit target of 3.9 percent of the GDP. "Fiscal deficit target of 3.9 percent for the current fiscal is sacrosanct and various options are available before the government, including further raising excise duty on petrol and diesel," official sources said.
Government has already raised excise duty on petrol and diesel, three times in quick succession, which will help it garner an additional Rs 10,000 crore in the fiscal and partly make up for the shortfall in disinvestment receipts and direct tax collections. "If global crude oil price provide room for further duty hike, it can be done. The government is open to idea as it will help boost revenue," sources said.
Last week, the government hiked excise duty on petrol by Rs 0.37 per litre and by Rs 2 a litre on diesel to mop up a little less than Rs 4,400 crore.