Motoring gets costlier as fuel price hike and ‘luxury tax’ kick in

As is wont every fortnight, the new month has opened up to a new fuel price hike. From the midnight of May 31/June 1, the price of petrol has risen by Rs 2.58 a litre and that of diesel by Rs 2.26 a litre.

This was expected considering that the global price of crude oil has crossed $50 for the first time this year which is a little more than double its price since January. The lowest price oil had receded to this year was $27 per barrel on January 18, 2016.

With this latest hike – the fifth in the first five months of the year – a litre of petrol now costs Rs 65.60 in Delhi, Rs 68.46 in Kolkata, Rs 70.18 in Mumbai and Rs 65.04 in Chennai. Meanwhile, diesel will cost Rs 53.93 a litre in Delhi, Rs 56.13 in Kolkata, Rs 59.21 in Mumbai and Rs 55.44 in Chennai.

New 1% tax for cars above Rs 10 lakh 

Meanwhile, from June 1, buyers of cars priced at over Rs 10 lakh will have to pay a 1% tax, as stated by finance minister Arun Jaitley in the 2016-17 Budget. The tax will be collected by the dealer and will be applicable on the ex-showroom price of the car.  The dealer/seller will transfer the tax collected at source (TCS) to the government and issue a TCS certificate to the car buyer.