22 Feb

In India, tax is increasing, not the ‘fuel price’

Fuel prices are rising through the roof. The reason we are given by the authorities is the rising crude oil prices, which is just half the truth. Here is how the fuel price is determined.

Fuel prices vary from state to state within our own country. The question is – What is the actual cost of fuel? 
For every litre of petrol we buy – taxes such as excise  duty, customs duty,  VAT, import duty are charged. We end up in paying 43 percent in the taxes. Breakup of these charges is provided below:

Excise duty – Rs 14.45
Import duty – Rs 2.5
Value added tax – 15% – 33% (varies state to state)
These central and state government charges make up the 50 percent of what we pay. The dealer earns as little as 1-2% as profit.

The generated VAT is meant to be used for the development within the states. Value added taxes differ from 15% to 33% from state to state. So depending on the state the petrol prices differ accordingly.

Below is the fuel price list of major cities:

State/City Petrol(Rs/ltr) Diesel(Rs/ltr)
Goa/Panjim 57.03 51.04
Orissa/Bhubaneshwar 68.33 51.00
New Delhi 69.06 48.16
Kerala/Trivandrum 71.28 50.86
TamilNadu/Chennai 72.17 51.23
UttarPradesh/Lucknow 74.44 51.35
AndhraPradesh/Hyderabad 75.37 52.46
Karnataka/Bengaluru 76.04 52.64

Goa for example, recently reduced the VAT on petrol thereby making it cheaper by Rs 11.

Fuel price Comparison with other economies
In USA, at present the fuel price is 3.74$ per galon, after conversion it becomes Rs 53.80 per litre. They have fixed per gallon taxes as well as taxes which are a fixed percentage of the sales tax. In fact, in US taxes and charges only account for 12-15 percent. Not even USA, but Pakistan fuel prices are 16 percent less than ours. Whereas if we compare prices with our neighbour Sri Lanka, they are 15 percent less and China is 2 percent less.

Locally decreasing fuel tax can decrease fuel prices, but globally prices are set by supply 
and demand, and therefore fuel tax decreases have no effect on fuel prices, and fuel tax increases actually decreases fuel prices by reducing demand. There is a need for better internal fuel pricing. We need a balance where one can enjoy affordable fuel prices. Oil companies are getting reasonable returns whereas our government gets the required revenue.

Do comment below ! Your feedback is valuable :)

49 thoughts on “In India, tax is increasing, not the ‘fuel price’

  1. 409612 991045I discovered your blog website on google and check just a couple of of your early posts. Proceed to preserve up the outstanding operate. I just extra up your RSS feed to my MSN Info Reader. Seeking forward to reading much more from you in a whilst!

  2. 428796 207337Beging with the entire wales well before just about any planking. Our own wales can easily compilation of calculated forums those thickness analysts could be the similar to some of the shell planking along with more significant damage so that they project after dark planking. planking 859191

  3. 282115 96258Fantastic post, I believe web site owners ought to acquire a great deal from this web website its extremely user pleasant. 974374

  4. 46913 786727Aw, it was an incredibly excellent post. In thought I would like to set up writing related to this in addition – taking time and actual effort to create a really excellent article

  5. 771232 336005fantastic post, extremely informative. I wonder why the other experts of this sector do not notice this. You should continue your writing. I

  6. 829401 4201This really is a good weblog i ought to say, normally i don????t post comments on other people???? blogs but would like to say that this post genuinely forced me to do so! 17713

  7. 484657 928970You created various great points there. I did a search on the topic and discovered many people will have the same opinion together with your blog. 472620

  8. 843105 391583Should you have been injured as a result of a defective IVC Filter, you ought to contact an experienced attorney practicing in medical malpractice cases, specifically someone with experience in these lawsuits. 87771

  9. 352637 634993informatii interesante si utile postate pe blogul dumneavoastra. dar ca si o paranteza , ce parere aveti de inchirierea apartamente vacanta ?. 407448

  10. 457762 830436Most appropriate the human race messages work to show your and present exclusive chance with unique couple. Beginer appear system in advance of raucous individuals will most likely always be aware most of the golden value off presentation, which is really a person

  11. 810835 472162A person essentially lend a hand to make significantly articles I may well state. That may be the really very first time I frequented your site page and up to now? I amazed with the research you created to create this specific publish incredible. Excellent activity! 538521

  12. 602927 254676Hey there, I believe your blog may be having browser compatibility issues. When I look at your web site in Safari, it looks fine but when opening in Internet Explorer, it has some overlapping. I just wanted to give you a quick heads up! Other then that, superb blog! 347925

  13. 917566 161510bless you with regard to the specific blog post ive truly been searching regarding this kind of info on the web for sum time correct now as a result cheers 534826

  14. 473437 194176Hi! I just wanted to ask if you ever have any issues with hackers? My last blog (wordpress) was hacked and I ended up losing a few months of hard work due to no back up. Do you have any methods to stop hackers? 311404

  15. 337518 116481Fairly uncommon. Is likely to appreciate it for individuals who consist of community forums or anything, internet website theme . a tones way for the client to communicate. Outstanding job.. 24345

  16. 341867 797503View the following guidelines less than and uncover to know how to observe this situation whilst you project your home business today. Earn dollars from home 459769

  17. 811953 432957For anybody who is interested in enviromentally friendly items, may possibly possibly surprise for you the crooks to maintain in mind that and earn under a holder basically because kind dissolved acquire various liters to critical oil to make. day-to-day deal livingsocial discount baltimore washington 178076

  18. can some one tells what is the rate that dealer pays to oil companies?

    is it base rate, or final price excluding Dealer commission, transportation cost etc

Leave a Reply

Your email address will not be published.


*

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>