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Taxing times for vehicle owners: How petrol is selling at almost three times the base price in TN

The base price of petrol is Rs 32.28. However, the excise duty of the Centre is Rs 32.90, which is more than the base price. The value added tax or state government tax of Rs 22.84 adds to the cost.

Published: 23rd February 2021 03:51 PM  |   Last Updated: 23rd February 2021 05:01 PM   |  A+A-

Fuel, petrol price hike

A filling station attendant fills petrol into a scooter in Chennai. (Photo | Debadatta Mallick, EPS)

Express News Service

CHENNAI: As the petrol price hovers close to Rs 100, The New Indian Express accessing data from petroleum dealers has learnt that the common man is paying Rs 55.74 as tax to avail one litre of petrol which costs around Rs 92 in the state.

According to the break-up provided by the Tamil Nadu Petroleum Dealers Association, the base price of petrol is Rs 32.28. However, the excise duty of the Centre is Rs 32.90, which is more than the base price. Similarly, the value added tax or state government tax of Rs 22.84 adds to the cost of petrol.

Other costs include freight charges of Rs 0.29 paise and dealer commission which is Rs 3.39.

Similarly, in the case of diesel, the common man is paying Rs 48.67 as taxes and other charges to avail one litre of diesel which is priced at Rs 84.97. While the base price of diesel is Rs 33.80, the excise duty of diesel is Rs 31.80. The state tax on diesel is Rs 16.87.

The freight charge is 0.29 paise and the dealer commission is Rs 2.21.

While the Centre is keen on dialogue with the state to bring down the fuel prices stressing on common taxation under GST, the state feels the Centre is to be blamed for imposing the cess last year which has resulted in increase in petrol prices.

According to sources, in March 2020, the special additional excise duty (surcharge) on auto fuels was increased by Rs 2 per litre and road cess was raised by Rs 1 per litre. Subsequently in May 2020, road cess on petrol and diesel was increased again by Rs 8 per litre, while the surcharge was hiked by Rs 2 per litre for petrol and Rs 5 per litre for diesel.

Interestingly, the Finance Minister in the Budget for the 2021-22 fiscal tweaked the excise duty structure to accommodate an agriculture infrastructure development cess, whose accruals would not be shared with the states.

The government had last year hiked excise duty by Rs 13 and Rs 16 per litre to mop up benefits arising from falling international oil prices. It hasn't cut the duty now that oil prices have risen, resulting in fuel prices climbing to record highs.

A top government official told The New Indian Express that the state restructured the taxes but it was not done to profit from it.

"The restructuring was done so that the state doesn't lose revenue if the fuel prices fall or rise. From our side, we maintained the balance," he insisted.



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