Budget 2026 Petrol and Diesel Prices: As Budget 2026 gets closer, people are again talking a lot about petrol and diesel prices. Fuel prices affect almost everything in daily life. Families spend more when fuel is costly. Transport of goods becomes expensive. This also pushes inflation highe as in 2024, fuel taxes gave the government more than Rs 5.5 lakh crore.
India buys around 85% of its crude oil from other countries. This makes fuel prices in India depend a lot on global oil rates. Even when crude oil prices fall at times, petrol prices in India often stay high. In big cities, petrol usually costs between Rs 95 and Rs 105 per liter. Many people hope Budget 2026 may reduce excise duty or change taxes to give some relief.
Diesel Prices
Diesel plays a very big role in India’s economy. Around 40% of goods transport runs on diesel vehicles. Because of this, even a small rise in diesel prices can increase food prices and delivery costs. Over the last few years, diesel prices have almost matched petrol prices. In many places, diesel sells between Rs 90 and Rs 100 per liter.
People expect that the government may look at diesel prices carefully in Budget 2026. Any change here can help control inflation and reduce transport costs. Still, there is no clear sign yet of a major cut.
Why Fuel is Not Under GST Yet?
Petrol and diesel are still outside the GST system mainly because of money reasons. The central government earns from excise duty, while state governments earn a lot from VAT. This setup gives both steady income. Keeping fuel out of GST also allows quick tax changes when crude oil prices or the rupee move suddenly.
If fuel comes under GST, businesses could benefit. Companies could claim input tax credit on fuel used in transport, factories, and airlines. This may lower costs for logistics and manufacturing and also currently the fuel taxes are treated as fixed costs with no tax credit benefit.
Union Budget 2026 Expectations: What Each Sector Is Demanding This Year?
Even if fuel is added to GST, prices may not drop automatically. Tax rates would need to be reduced carefully so states do not lose revenue. Global crude oil prices, which are around USD 80 per barrel, will also decide final fuel prices.
The government has said it is open to bringing fuel under GST, but only if states agree. From a legal point of view, GST on fuel can start only after an official notification but no date has been shared yet.
