Wednesday, July 7, 2010

Fuel & Tax

Entry tax is 5% on fuel while sales tax is 25% on petrol and 18% on diesel respectively. There is no entry tax for diesel. The BJP government has put the onus on the Centre to reduce fuel rates, maintaining it had brought down sales tax on petrol from 28% to 25% and diesel from 20 to 18% within a month of its coming to power in 2008.
According to Dr Acharya, taxes are the highest in Karnataka compared to New Delhi because of transportation costs, despite Mangalore having an oil refinery. "Though New Delhi has no refinery, it’s considered a zero transport place. However from Karnataka, transport equalization charge is collected for fuel being transported from Chennai and Cochin. The Mangalore refinery is not taken into account. If this is done, the government can sell petrol and diesel at a lower rate in at least eight to 10 districts," (TOI)

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