Centre cuts windfall tax on domestic crude oil export, Check new rates here
When the levy was first introduced, a windfall tax on export of petrol alongside diesel and ATF too was levied.
The Central government has reduced the windfall tax on domestic crude oil export to ₹1,700 per tonne from the existing ₹4,900 per tonne. The tax on Aviation Turbine Fuel (ATF) has also been slashed to ₹1.5 per litre from ₹5 per litre, according to the finance ministry notification issued on Thursday.
It also stated that the reduction in windfall tax on diesel and ATF will come into force from today, December 16, as per notification quoted by ANI.
Take a look at new rates below:
Windfall Tax Revision | December 16 | December 1 |
ATF | ₹1.50/L | ₹5/L |
Diesel | ₹5/L | ₹8/L |
Crude | ₹1,700/L | ₹4,900/L |
Petrol | Nil | Nil |
Earlier on December 1, the Centre reduced the windfall tax on sale of domestic crude oil to ₹4,900 per tonne from the current tax of ₹10,200 crore.
When the levy was first introduced, a windfall tax on export of petrol alongside diesel and ATF too was levied. Earlier, the special additional excise duty on aviation turbine fuel has been kept unchanged at ₹5 a litre. But the tax on petrol was scrapped in subsequent fortnightly reviews.
The windfall tax on crude oil is calculated by taking away any price that producers are getting above a threshold, and the levy on fuel exports is based on cracks or margins that refiners earn on overseas shipments. These margins are primarily a difference of international oil price realized and the cost.
Crude prices have largely been subdued amid continued strict Covid-19 restrictions in China and concerns of an impact on demand from the world’s second largest crude oil importer.
The windfall taxes were first imposed on July 1 as energy companies were making huge profits amid multi-year high levels of crude oil prices due to the Russia-Ukraine conflict. At that time, export duties of ₹6 per litre each were levied on petrol and aviation turbine fuel and ₹13 a litre on diesel. The windfall tax on sale of locally produced crude oil was ₹23,250 per tonne when the tax was first imposed.
(With ANI inputs)
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