The price of gasoline exceeds 100 rupees in 19 states; Know how much tax you pay to the state, at the center

Gasoline and diesel prices are at an all time high in India. The prices of domestic fuels have risen sharply since the beginning of May. After an 18-day gap, state-run oil marketing companies resumed daily fuel price revisions on May 4. Since then, the price of gasoline has increased by Rs 10.88 per liter and that of diesel by Rs 9.47.

The price of gasoline has exceeded 100 per liter in at least 19 states and Union Territories of the country – Maharashtra, Delhi, West Bengal, Tamil Nadu, Andhra Pradesh, Telangana, Rajasthan, Madhya Pradesh, Karnataka, Uttar Pradesh, Haryana, Jammu and Kashmir, Odisha, Ladakh, Bihar, Kerala, Punjab, Sikkim and Nagaland.

The price of automotive fuel in India depends on international crude oil prices, rupee-dollar exchange rate. In addition, the central government and states levy various taxes – excise duty and value added tax (VAT) on gasoline and diesel. Dealer commission and freight charges are also added to the price of fuel. Note that gasoline and diesel are not subject to the Goods and Services Tax (GST).

Some of the states that apply the highest VAT rates are Rajasthan, Telangana, Madya Pradesh and Odisha, according to data submitted by the Ministry of Oil and Natural Gas to parliament on July 19. These aforementioned states, and others, add on a long series of other charges such as tax, additional taxes, and surcharges to existing fuel prices. This is causing fuel prices to skyrocket even further, Minister of State for Oil and Natural Gas Rameswar Teli said in a written response to the House. At the other end of the spectrum are the Union Territories (TU), which have historically imposed lower taxes on fuels. Arunachal Pradesh and Mizoram are among the lowest paying UTs.

Rajasthan has the highest taxes with a 36% VAT with an additional charge of Rs 1,500 per KL of road development cess. Karnataka follows closely behind with a 35 percent sales tax. Telangana has a 35.20 percent VAT on base fuel charges, while Odisha carries a 32 percent VAT. On the low end, Lakshadweep has no charge in terms of taxation on gasoline prices. The Andaman and Nicobar Islands charge a nominal VAT of 6 percent. Dadra and Nagar Haveli and Daman and Diu apply 20 percent VAT on their gasoline prices. In Arunachal Pradesh, motorists must pay a marginal VAT of 20 percent. Meghalaya has a 20 percent tax or Rs 15.00 per liter (whichever is greater) as well as a pollution surcharge of 10 paise per liter.

The Center increased excise duties by Rs 13 on gasoline and Rs 16 on diesel between March 2020 and May 2020. Excise duty on gasoline increased from Rs 19.98 per liter to 32 , 9 Rs. On diesel, the excise tax was increased to Rs 31.8 against Rs 15.83 per liter. After this revision, central government tax collections on gasoline and diesel jumped 88 percent to Rs 3.35 lakh crore in FY21. The collection was Rs 1.78 lakh crore a year ago, said Minister of State for Oil and Natural Gas Rameswar Teli in Lok Sabha. Excise collections in April-June this year amounted to Rs 1.01 lakh crore, said Minister of State for Finance Pankaj Chaudhary. However, this number also includes excises not only on gasoline and diesel, but also on ATF, natural gas and crude oil,

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