New Delhi, Nov. 7: State-owned oil firms have decided to absorb the increase in excise duty of Rs 1.60 on a litre of petrol and 40 paise on a litre of diesel for the time being. So there will be no change in the retail prices of fuel.

"There will be no change in the retail prices of petrol and diesel for now...We are not passing on the excise duty hike as of now," a senior IOC official said.

The increase in excise duty on the fuels is likely to yield an additional revenue of about Rs 3,200 crore to the government during the rest of the current fiscal.

The government late last night raised excise duty on petrol and diesel to mop up additional revenue to meet budgetary targets.

The government had collected Rs 99,184 crore in excise collections from the petroleum sector in 2014-15. This was Rs 33,042 crore in the first quarter of the current fiscal.

The basic excise duty on unbranded or normal petrol was increased from Rs 5.46 per litre to Rs 7.06 a litre, according to a CBEC notification.

After including additional and special excise duty, the total levy on petrol will be Rs 19.06 per litre against Rs 17.46 at present. Similarly, on unbranded or normal diesel, excise duty has been increased from Rs 4.26 per litre to Rs 4.66 a litre. After including special excise duty, total incidence of excise duty on diesel will be Rs 10.66 per litre against Rs 10.26 now.

The excise duty on branded petrol has been hiked from Rs 6.64 to Rs 8.24 per litre. Special and additional excise duty of Rs 12 per litre will continue as before. On branded diesel, excise duty has been increased from Rs 6.62 to Rs 7.02 per litre. Additional excise duty of Rs 6 per litre will continue as before.

The government had previously in four instalments raised excise duty on petrol and diesel between November 2014 and January 2015 to take away the reduction in retail rates that was warranted from falling international oil prices.

The four excise duty hikes during this period totalled Rs 7.75 per litre on petrol and Rs 6.50 a litre on diesel. It led to about Rs 20,000 crore in additional revenue to the government, helping it meet its fiscal deficit target.

Tax on petrol and diesel was first raised by Rs 1.50 a litre each from November 12, 2014.