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All About Petrol Tax in Goa

After the Central Government announced reduction of excise duty on petrol by ₹5 per litre, the State Government of Goa lowered VAT rates on petrol. To know more about petrol tax in Goa, keep reading!

The Chief Minister of Goa Pramod Sawant declared to reduce VAT on petrol by ₹7 per litre after the announcement of the Central Government to lower excise duty on petrol. This was done to relieve Indian citizens from rising fuel costs.

After the reduction of VAT and excise duty on petrol, dealers in Goa had incurred a cumulative loss of approximately ₹6 crores.

Here is this table mentioned below that summarises components that constitute the petrol price in Goa:

Elements	Effective as 21st October 2022 (in ₹ per litre)
Price charged to dealers	₹57.35 per litre
Excise duty (levied by the Central Government)	₹ 19.90 per litre
Average dealer commission	₹5.58 per litre
VAT (levied by the State Government)	₹14.92 per litre {18.21% of (fuel price charged to dealers + excise duty + avg. dealer commission)} (an additional 0.5% green cess is applicable on VAT)
Retail selling price of petrol at Goa	₹97.75 per litre

(Note: The above table serves only as an example to explain the petrol tax breakup, with data taken from reliable and authorised sources as of 21st October 2022 . The actual prices, however, may vary as fuel price, dealer's commission, cess and other such aspects change periodically.)

Who Levies Petrol Tax in Goa?

The Central Government imposes excise duty (₹19.90 per litre) on petrol and the State Government of Goa levies VAT (₹14.92 per litre) on petrol in Goa. Thus, tax rates charged by both Central and Goa Governments influences petrol price in Goa, apart from other factors such as dealers' commission, price of crude oil etc.

What Are the Factors Affecting Petrol Tax in Goa?

Factors that affect the petrol tax in Goa are as follows:

1. Price of Crude Oil

Demand and supply of crude oil, oil reserves and supplies, international political relations determine the price of crude oil. Change in its price affects petrol prices across India.

2. Dealer's Commission

Oil Marketing Companies give a commission to petrol pump owners. This commission affects the petrol price in Goa and across India.

3. Cost for Dealers

Oil Marketing Companies charge a price to dealers to distribute crude oil. This price plays a determining factor in the petrol price of Goa and India.

4. State's Sales Tax and Central's Excise Duty

Respective state governments impose VAT on petrol after considering excise duty, dealer's commission charged etc. On the other hand, the Central Government levies excise duty on petrol. Both these tax rates influence the petrol price in Goa.

5. Valuation of Indian Currency Against US Dollars

Crude oil is purchased from the international market in dollars. Hence, the exchange rate of Indian rupees and dollars influences the petrol price in the domestic market. For example, if the valuation of the American dollar increases, it will raise the purchasing price of crude oil and, subsequently, the petrol price.

6. Demand and Supply of Petrol

If the supply of petrol falls short and fails to meet its increasing demand, the price of petrol rises as per the law of economics.

Is Petrol Tax Same in All Places of Goa?

Yes, the Goa Government levies a uniform VAT rate across the state. Hence, every city resident will pay a similar tax rate on petrol. However, there is a slight variation in petrol prices in North and South Goa.

The reduced excise duty and the VAT on petrol lowered Goa's petrol price by ₹12 per litre, thus providing relief to state residents. However, petrol tax in Goa and cost may vary later, so keep an eye on current updates.

Frequently Asked Questions

All

How much VAT did Goa impose on petrol before reducing it in November 2021?

The Government of Goa levied a VAT of 27% plus 0.5% green cess on petrol before reducing it in November 2021.

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When did the Central Government lower the excise duty on petrol?

The Central Government lowered excise duty on petrol on 3rd November 2021.