Did you know that in some states, consumers pay close to 50 percent as tax and other charges on the petrol purchased? The government makes a major portion of its tax revenue from petroleum products and a recent PTI report stated citing a government official that the Union government will not be reducing the excise duty it imposes as it would widen the CAD (current account deficit) and disturb the country's fiscal math. Besides the central government, states also impose VAT (value added tax) and surcharges burning a bigger hole in consumer's pockets.
The price at which the state-owned retailer Indian Oil Corporation (IOC) sells petrol to dealers was a little over Rs 39 per litre excluding VAT and excise on Saturday as per an ET report. As the prices on petrol and diesel hit new highs, here is a list of percentages of VAT that are imposed on the fuels across states and union territories in India:
|Andaman and Nicobar Islands||6.00%||6.00%|
|Dadra and Nagar Haveli||20.00%||15.00%|
|Daman and Diu||20.00%||15.00%|
|Jammu and Kashmir||27.36%||17.02%|
|Maharashtra (Mumbai, Thane and Navi Mumbai)||39.12%||24.78%|
|Maharashtra (rest of the state)||38.11%||21.89%|
Note that the tax rates above include state taxes, VAT, additional tax, cess and surcharges that are recoverable as central sales tax and other central levies. Excise duty levied by the central government is Rs 19.48 per litre on non-branded petrol and Rs 15.33 per litre on regular diesel. Branded fuel rates are higher.
In states of West Bengal and Bihar an additional surcharge of 20 and 30 percent is levied respectively on fuel and it is irrecoverable.
Dealer's commission is also added to the final retail price you pay at the fuel stations and it varies based on location at the range of Rs 3 to 3.65 per litre for petrol and Rs 2 to Rs 2.62 per litre for diesel.
Also note that state governments of Arunachal Pradesh, Delhi, Gujarat, Haryana, Madhya Pradesh, Punjab, Chandigarh, Puducherry, Andaman and Nicobar, Meghalaya, Dadar Nagar Haveli and Daman and Diu charge additional VAT or sales tax on dealer's commission.