Jaipal Reddy's recommendation of imposing extra duty on diesel vehicles unjustified: Praful Patel

NEW DELHI: Heavy Industry Minister Praful Patel has said that Oil Minister Jaipal Reddy's recommendation of levying extra duty of up to Rs 2.55 lakh on diesel cars is flawed and also not justified.

In a letter to Union Finance Minister Pranab Mukherjee, Patel said, “This would amount to an unjustified abnormal hike in excise duty in case of small diesel cars which would definitely be resented by the consumers. I personally feel that the whole rationale of imposing a higher duty on a particular segment of the automotive sector, namely diesel cars, is highly flawed.”

He has been referring to Reddy's proposal to the FinMin proposing rise in excise duty on diesel vehicles ranging between Rs 1.70 lakh and Rs 2.55 lakh to make up for subsidised fuel being used in personal vehicles.

Meanwhile, the FinMin is planning to place more levy on diesel vehicles. The automobile sector is not in the favour of the idea of diesel vehicles being taxed more since such a move will impact the growth of the sector.