In the current pricing policy, the price of diesel in India consists of
Fuel component + Customs duty + Excise duty + Sales VAT + Dealer's commission
Fuel component + Excise duty + Sales VAT + Dealer's commission
Fuel component + Customs duty + Sales VAT + Dealer's commission
Fuel component + Customs duty + Excise duty + Dealer's commission
Answer is Right!
Answer is Wrong!
This question was previously asked in
UPSC CAPF – 2013
– These components typically include:
1. **Base Fuel Price:** This is the cost of the fuel at the refinery gate, including the cost of crude oil, refining charges, and freight. This is represented by “Fuel component”.
2. **Central Excise Duty:** A tax levied by the central government.
3. **State VAT/Sales Tax:** A tax levied by the respective state governments, which is usually ad valorem (a percentage of the price).
4. **Dealer’s Commission:** The margin paid to the fuel pump owners.
5. Other minor charges (like pollution cess, etc.) may also be included.
– Customs duty is levied on imported goods. While crude oil is imported (and customs duty applies), the refined product (diesel) sold domestically faces Central Excise and State VAT. If refined diesel is imported, customs duty would apply, but Excise and VAT are the standard components levied on domestic sales alongside the base price and dealer commission.
– Option B (Fuel component + Excise duty + Sales VAT + Dealer’s commission) represents the standard and most significant components of the retail diesel price in India.
– Option A includes Customs duty *along with* Excise and VAT, which is less typical for the main pricing structure of domestically supplied fuel compared to Excise and VAT.