What Taxes We Pay on Petrol & Diesel

Government’s revenue by VAT and taxes has increased by levying more taxes on petrol and diesel.

Published
India
3 min read
Here’s what’s at stake of Taxes on petrol and diesel. 
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1. The Central Excise Duty on petrol increased from Rs 9.48 per liter to a high of Rs 21.48 per liter. In October 2017, the excise duty on petrol was reduced by Rs 2 per liter, the first such reduction by the BJP government.

On the other hand, the duty on diesel increased by more than 4 times from Rs 3.56 per liter to a high Rs 17.33 per liter. Like petrol, the duty was reduced by Rs 2 per liter in October 2017 to Rs 15.33 per liter.

central excise duty on petrol and diesel
central excise duty on petrol and diesel
(source: PPAC)

2. The State VAT on petrol is at least 25 percent in 21 states with the highest in Mumbai at 39.54 percent. The State VAT on diesel is more than 20 percent in 14 states and highest of 28.31 percent in Andhra Pradesh.

State VAT on petrol and diesel.
State VAT on petrol and diesel.
(Source: PPAC)

3. The Central Government revenue from excise duty on petrol & diesel more than tripled between 2013-14 and 2017-18. During the same period, the State Governments revenue through VAT also increased by more than 38 percent.

Revenue through excise duty.
Revenue through excise duty.
(Source: PPAC)

4. In the Retail Selling Price of Diesel (in Delhi at IOCL as of 3rd September 2018), 36.2 percent is taxes. In other words, for every Rs 100 you pay for diesel, Rs 36.2 goes to the government in the form the taxes if you are in Delhi. The amount of taxes will be different in different states based on the State VAT & other factors.

Tax you pay while buying diesel.
Tax you pay while buying diesel.
(Source: PPAC)

5. In the Retail Selling Price of Petrol (in Delhi at IOCL as of 3rd September 2018), 45.9 percent is taxes. In other words, for every Rs 100 you pay for petrol, Rs 45.9 goes to the government in the form the taxes if you are in Delhi. The amount of taxes will be different in different states based on the State VAT & other factors.

Tax you pay while buying petrol.
Tax you pay while buying petrol.
(Source: PPAC)

(This story originally published on Factly and has been republished by The Quint with permission)

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