Petrol Tax in Telangana: Different Types of Taxes Applicable on Petrol
The information in this article was last updated on 21st October 2022.
The price of petrol in Telangana crossed ₹100 in June 2021.
Presently, as of 21st October 2022, the petrol price reached a high of ₹109.66 per litre
However, almost half of this price is ascribed to VAT and other cesses imposed by State and Central governments.
On this note, let’s look at some details of the petrol tax in Telangana.
What Is the Petrol Tax Levied in Telangana?
Petrol price in Telangana is revised daily based on the Dynamic Fuel Pricing. It is fixed at 6 am IST every day.
Despite the Centre’s cut on excise duty on petrol, Telangana State Government did not follow suit and is unlikely to do so anytime soon. Currently, it levies a VAT of 35% on petrol.
This state earns heavily from the petrol tax or VAT. It makes nearly ₹ 10,000 crores from petrol tax.
Here is the tax break-up on the price of petrol.
| 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 | ₹3.97 per litre |
| VAT (Levied by the State Government) | ₹28.44 per litre {35% of (fuel price charged to dealers + excise duty + avg. dealer commission)} |
| Retail selling price at Telangana | ₹109.66 per litre |
(Note: The above table serves 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. Check the latest petrol prices in Telanaga)
Who Levies the Petrol Tax in Telangana?
The tax on petrol in Telangana depends on the base price, the excise duty imposed by the Central government and the VAT which the State government imposes. A combination of these three factors makes up the petrol price in Telangana.
What Factors Affect the Petrol Tax in Telangana?
The following are some of the most essential factors that affect petrol tax in Telangana:
1. Crude Oil Price
The price of crude oil has a lot to do with the petrol tax and price in Telangana and across the nation.
2. Demand and Supply of Fuel
This is one of the crucial factors that primarily affects the price of crude oil, thereby directly and indirectly affecting the tax on petrol.
3. State’s Sales Tax or VAT
The State’s VAT or sales tax on petrol is one of the most important sources of revenue for the Government. Some of the aspects that decide this VAT are crude oil prices and dealer’s commission, to name a few.
4. Central Excise Duty
The Central Government levies this component of the petrol tax, that is applicable throughout the country, unlike sales tax which varies from state to state.
Is Petrol Tax the Same in All Places of Telangana?
Although petrol tax is the same throughout the state, petrol price is not the same in all places of Telangana due to varying dealer’s commissions that depend on the petrol pumps you visit.
In conclusion, to know the petrol tax in Telangana, you have to check it every day. You can do so on the websites of Indian Oil, Bharat Petroleum, and Hindustan Petroleum.
Frequently Asked Questions
Does petrol fall under GST?
No, petrol still does not come under the Goods and Services Tax.
What is meant by the refinery transfer price?
Oil marketing companies pay this price, and it is required to finance the conversion of crude oil into petroleum. It also affects the price of petrol.