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!

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.

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.

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.