All About Petrol Tax in Rajasthan
The information in this article was last updated on 21st October 2022.
Indian fuel consumers are expected to get relief from high petrol prices given its reduced central excise duty by ₹5 per litre.
Accordingly, states like Rajasthan have also taken a step to lower VAT on this fuel. It levies a sales tax of ₹30.51 per litre on petrol. Want to know more about petrol tax in Rajasthan? Keep reading!
What Is the Petrol Tax Levied in Rajasthan?
The state tax on petrol in Rajasthan is ₹28.61 per litre of this fuel (as of October 2022).
Despite lowering the tax on petrol in Rajasthan, the latter continues to have the highest VAT on petrol.
Besides state VAT, several components determine the retail price of fuel. Take a look at this table illustrated below representing an overall breakdown of petrol price in India -
| Elements | Effective as of 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 | ₹2.21 per litre |
| VAT (Levied by the State Government) | ₹28.61 per litre {36% of (fuel price charged to dealers + excise duty + avg. dealer commission)} |
| Retail selling price at Rajasthan | ₹108.07 per litre |
(Note: The above table serves as an example to explain the petrol tax breakup, with data taken from reliable and authorised sources. The actual prices, however, may vary as fuel price, dealer’s commission, cess and other such aspects change periodically. Check the latest petrol prices in Rajasthan)
Who Levies the Petrol Tax in Rajasthan?
The central government imposes excise duty on petrol. Similarly, the state government of Rajasthan levies VAT on fuel. However, VAT on petrol varies with each state.
What Are the Factors Affecting Petrol Tax in Rajasthan?
Note the following factors that affect the price of petrol in Rajasthan -
1. Commission of Dealers
The OMCs pay a specific commission to fuel dealers. This commission covers a dealer's overall earning, profit and cost and affects the price of petrol.
2. Excise Duty and VAT
A central excise duty remains fixed as it is a predefined charge imposed on petrol's price. At the same time, VAT on petrol differs with each state. The state government considers a few factors, such as the excise duty, dealer's commission etc., while determining the VAT.
3. Demand and Supply of Petrol
With increasing automobiles plying on roads, there is an increase of demand for petrol as well. Oil refinery companies obtain the crude oil from international markets for processing it into petrol, supply often remains inadequate. Therefore, if demand is more than supply, the price of petrol rises and vice versa according to the laws of economics.
4. Value of Indian Rupee vs US Dollar
The transaction of crude oil in the international market is done in American dollars. Thus, a change in the value of the US dollar directly impacts the petrol price.
5. Availability of Refineries
The crude oil is sent to refineries for processing into petrol. However, fewer refineries will result in lower availability and supply of petrol against its increasing demand. This will result in increasing the price of petrol.
Is the Petrol Tax in Rajasthan Similar Across All Cities?
Yes. Rajasthan's petrol tax is similar across all cities. However, the petrol price may vary with each city. For example, the petrol price is ₹111.06 per litre in Jaipur. At the same time, it is ₹114.33 per litre in Jaisalmer. This depends on the change in the dealer's commission and other factors in each city.
The state officials in Rajasthan estimate a total loss of ₹1,800 crores in VAT revenue given the reduced price of petrol. However, the state government is ready to bear this financial brunt to provide relief to residents. Keep an eye on regular updates of petrol tax in Rajasthan as the price of petrol is subject to change as it depends on several factors mentioned above.
Frequently Asked Questions
Is petrol tax in Rajasthan inclusive of road development cess?
A VAT on petrol in Rajasthan is also inclusive of ₹1500/KL road development cess (as of October 2022).