A cabinet meeting held on Tuesday decided to exempt a 50 percent on both customs and infrastructure development duties for petrol, diesel, and kerosene.
How much tax has been cut?
According to Manoj Thakur, spokesperson of Nepal Oil Corporation, there will be a significant change in the rate of tax on fuel after the government's decision. Currently, the NOC has been collecting Rs 10 per liter as infrastructure development tax, but now it will charge only Rs 5.
Similarly, the customs duty on petrol will now be Rs 12.5 per liter from Rs 25 per liter and diesel will be Rs 6 per liter from Rs 12 per liter.
Why hasn't the price come down for consumers?
Although the government has given a 50 percent discount on tax, consumers will not get direct benefit from it. There will be no change in the current price of fuel in the market. Currently, the NOC has a loss of Rs 120 per liter in diesel and Rs 35 per liter in petrol. The corporation has expressed its intention not to adjust the price as it will use the tax exemption given by the government to cover its losses. Although this decision will provide some relief to the corporation financially, the consumers will have to pay a high price.
