Fuel excise in Australia: how much tax you pay per litre

When the board at your local servo reads 190.9, a bit under a third of that is federal tax. Fuel excise is the largest single line item in an Australian pump price after the fuel itself, and it moved sharply this month — the temporary relief that had been in place since April finished on 2 August 2026.

Here's what the tax is, what it costs you, and why knowing the number is more useful than it sounds.

What fuel excise actually is

Fuel excise is a flat federal tax charged per litre of fuel, not a percentage of the price. It's collected by the Australian Government when fuel leaves a refinery or import terminal, and the cost is passed down the chain to the bowser. Because it's a fixed cents-per-litre amount, it doesn't rise when crude oil rises — it sits underneath the price like a floor.

Two things move the rate. The first is indexation: the Australian Taxation Office adjusts fuel excise twice a year, in February and August, in line with movements in the consumer price index. The indexation factor applied to the rates that took effect on 3 August 2026 was 1.020. The second is direct government intervention, which is what produced the temporary cuts of the past few months.

Excise goes into general federal revenue rather than being locked to road funding. The Australian Automobile Association, which campaigns for every cent to be returned to land transport, puts the proportion actually reinvested in land transport projects at around 57% over the decade to 2022–23.

How much fuel excise you pay per litre in 2026

The 2026 rates for the main road fuels, straight from the ATO's excise duty tables:

Fuel	1 Apr – 30 Jun 2026	1 Jul – 2 Aug 2026	From 3 Aug 2026
Petrol (ULP, all octanes)	20.6c/L	36.6c/L	53.7c/L
Diesel	20.6c/L	36.6c/L	53.7c/L
LPG (duty paid)	6.7c/L	12.0c/L	17.5c/L
Denatured ethanol for fuel	6.8c/L	12.0c/L	17.6c/L
Biodiesel	6.9c/L	13.4c/L	19.7c/L

Note that the octane grade makes no difference. 91, 95 and 98 all carry the same 53.7c, which is worth remembering when someone tells you premium is expensive "because of the tax". It isn't — the gap between 91 and 98 is refining cost and retail margin.

E10 is the exception, and it works in your favour. Petrol-ethanol blends are taxed under a formula that applies the much lower ethanol rate to the ethanol share of the blend, so a litre of E10 carries slightly less excise than a litre of straight 91. It's a small part of why E10 usually sits below 91 on the board — competition and wholesale cost do most of the work. Our guide to E10 vs 91 vs 95 vs 98 covers whether it's the right fuel for your car.

Why the rate jumped on 3 August 2026

In response to the fuel price surge that followed the outbreak of conflict in the Middle East in early 2026, the government cut excise in two stages. From 1 April to 30 June the rate was reduced by 60.9% of the full rate, taking petrol and diesel down to 20.6c/L. That relief was then extended through July at a smaller 30.4% reduction, holding the rate at 36.6c/L until 2 August.

From 3 August 2026 the relief ended and the full, newly indexed rate of 53.7c/L applied. That's a 17.1c per litre increase in excise, which becomes roughly 18.8c a litre at the pump once GST is added on top.

Excise is charged when fuel leaves the terminal, not when you buy it, so a servo sells through stock it already paid the old rate on before the new rate reaches the board. In practice a change like this takes about a week to ten days to fully flow through — which is why pump prices kept climbing well after the calendar date.

GST is charged on top of the excise

This is the part most people miss. GST is calculated on the final retail price of fuel, and that price already includes excise. You are, in effect, paying 10% GST on the excise as well as on the fuel.

Work it through on a litre priced at 190c. Roughly 17.3c of that is GST (one eleventh of the GST-inclusive price), and 53.7c is excise. That's about 71c of federal tax in a 190c litre — a bit over 37%. The remaining 119c or so covers the wholesale cost of the fuel, freight, and the retailer's margin.

What the tax adds up to on a tank

A 60-litre fill at 53.7c/L excise carries $32.22 in excise alone, before GST. The August increase of about 18.8c a litre at the pump adds roughly $11.28 to that same 60-litre tank compared with July.

Across a year, the numbers get serious. The AAA estimated Australian motorists paid about $15.71 billion in net fuel excise in 2023–24, working out to roughly $1,283 for a typical household. For anyone doing high kilometres, tax is quietly one of the larger lines in the household budget.

If you want your own figure rather than an average, our fuel cost calculator will work out what a given trip or a year of driving costs at whatever price you're actually paying.

Who doesn't pay the full rate

Fuel excise is designed as a road-use charge, so several groups pay less than the headline rate or nothing at all.

• Off-road business use. Businesses using fuel in machinery that doesn't travel public roads — mining, agriculture, marine, construction plant — can claim fuel tax credits that refund some or all of the excise. If you run a business with vehicles or plant, this is worth checking against your fuel card records, since the reporting a card produces is exactly what a credit claim needs.
• Heavy vehicles on public roads. Trucks, buses and coaches pay a separate Road User Charge on diesel, which reduces the fuel tax credit they can claim. The net effect is that heavy transport still contributes for its road use, just through a different mechanism.
• Electric vehicles. A battery electric vehicle buys no liquid fuel and therefore pays no excise. As the fleet electrifies, the excise base shrinks — which is the policy problem sitting behind every road-user-charge debate you've read about.
• Aviation. Aviation gasoline and aviation kerosene are excised at 3.556c/L and aren't subject to the twice-yearly indexation that applies to road fuels.

Why any of this helps you pay less

Excise is identical at every servo in the country. There is no state fuel tax in Australia — the excise on a litre in Kalgoorlie is the same as in Hobart. So when you see a 30c/L gap between two stations in the same suburb, none of it is tax. All of it is wholesale cost, freight and, mostly, retail margin.

That's the practical takeaway. The tax component is fixed and out of your hands; the 20–40c spread between the cheapest and dearest servo in your area is not. Timing your fill to the bottom of a price cycle and choosing the right station are the only two levers that actually move, and together they're worth far more per year than any excise change.

Our guide to finding the cheapest fuel in Australia covers how to use the official state feeds to do that, and fuel prices by state explains how the reporting scheme works where you drive.

This is general information about how fuel excise works, current at August 2026, not tax advice. Rates change with indexation each February and August. For fuel tax credits or anything specific to your circumstances, check the ATO or talk to a registered tax agent.

Frequently asked questions

How much tax is on a litre of petrol in Australia?

From 3 August 2026 the fuel excise on petrol and diesel is 53.7 cents a litre. GST of 10% is then charged on the whole pump price, excise included, so the total federal tax on a litre priced at 190c is roughly 71c.

Did fuel excise go up in August 2026?

Yes. Temporary fuel excise relief ended on 2 August 2026. The rate went from 36.6 cents a litre to 53.7 cents a litre from 3 August — a rise of 17.1 cents, or about 18.8 cents once GST is added.

Is there GST on fuel excise?

Yes. GST is calculated on the final retail price of fuel, which already includes excise, so you effectively pay 10% GST on the excise component as well.

Does fuel excise vary by state?

No. Fuel excise is a federal tax and no Australian state or territory levies its own fuel tax, so the excise on a litre is identical everywhere. Price differences between states come from freight, competition and retail margin, not tax.

Do electric vehicles pay fuel excise?

No. Fuel excise applies to liquid and gaseous fuels, so a battery electric vehicle pays none of it. That is one reason the excise base is expected to shrink as the vehicle fleet electrifies.

How long does an excise change take to show up at the bowser?

Usually about a week to ten days. Excise is paid when fuel leaves the terminal, so servos work through stock bought at the old rate before the new one reaches the board.