These are some factors that affect tax of petrol in Gujarat.
Price of Crude Oil
As discussed earlier, crude oil prices impact petrol prices significantly. This price fluctuates with market conditions, demand and supply of oil, oil reserves, international politics, etc.
To have a clear idea of Gujarat's petrol tax, individuals should note the latest crude oil price.
Cost for Dealers
OMC or Oil Marketing Companies charge a specific charge from dealers. This factor again impacts petrol prices in Gujarat and other states. Refining and freight charges also impact petrol tax in Gujarat.
Oil Marketing Companies extend a commission to fuel dealers. This is a part of their earnings which impacts petrol price in Gujarat.
Central Excise Duty
Excise duty is fixed by Central Government on Indian fuels. This amount doesn’t fluctuate with fuel prices even when crude oil price rises.
State’s Sales Tax
This sales tax or VAT depends on factors such as dealer’s commission, excise duty, crude oil price, etc.
Demand and Supply of Fuel
The demand for petrol and lack of supply increases petrol prices and vice versa. This factor impacts petrol prices and petrol tax levied in India.
Value of Indian Rupees Against US Dollars
Transaction of crude oil takes place in US Dollars. A slight change in Dollar’s value impacts the Indian Rupee. An increase in Dollar’s value will lead to a rise in purchasing price.
These are some essential data on petrol tax in Gujarat and other related factors. Individuals should know how to calculate charges levied under petrol tax to understand the tax breakage better.