How much tax you pay on fuel - Fusion - WeRIndia

How much tax you pay on fuel

How much tax you pay on fuel

Fuel prices are skyrocketing and nearly half of the amount in the prices includes taxes and other charges imposed by both the Centre and State governments.

Do you know how much you are paying exactly in the form of taxes?

As per an ET report, the dealers were sold by the state-owned retailer Indian Oil Corporation (IOC) at the rate of ₹39 per litre excluding VAT and other taxes.

At present, the central government levies excise duty on petrol and diesel at ₹19.48 per litre and ₹15.33 per litre respectively. This is the charge on non-branded fuel. Branded fuel rates are higher.


VAT is different in various states. However, it is 25 percent in 26 states, with the highest in Mumbai at 48.98 percent. The lowest VAT is in Andaman and Nicobar Islands where a 6 per cent sales tax is charged on both petrol and diesel.

In southern states, Andhra Pradesh is charging is the highest on petrol and diesel at the rate of 35.77 percent and Telangana is charging 28.08 percent.

Compared to all metro state capitals, fuel prices are the cheapest in Delhi with the tax rate of 27.00 percent and 17.24 percent on petrol and diesel respectively.

Some states like West Bengal and Bihar are charging an additional surcharge of 20 and 30 percent on fuel. This surcharge is irrecoverable.

In addition to that, dealer’s commission is also charged to the final retail price. It varies with the location ranging from ₹3 to ₹3.65 per litre for petrol and ₹2 to ₹2.62 per litre for diesel.

Some state governments charge additional VAT or sales tax on dealer’s commission as well. Some of these state governments include Arunachal Pradesh, Delhi, Gujarat, Haryana, Madhya Pradesh and Punjab. Others are Andaman and Nicobar, Chandigarh, Dadar Nagar Haveli, Daman and Diu, Meghalaya, and Puducherry.

 

Image Reference: Goodreturns

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