NEW DELHI: As the crude oil prices softened in the international market, India on Friday slashed the windfall profit tax on domestically-produced crude oil, as well as on the export of diesel and aviation turbine fuel (ATF).
As per official notification, the tax on crude oil produced in the country has been reduced to Rs 1,700 per tonne from Rs 4,900. The government also reduced Rs 3 per litre on the export of diesel to Rs 5 per litre from Rs 8 per litre. The tax on export of ATF was reduced to Rs 1.5 a litre from Rs 5 a litre. The new tax rates are effective from December 16.
Currently, crude oil in the international market came down by nearly 14%. Brent Crude Future, the benchmark of the crude price in the international market, was trading at $78.41 per barrel at 7.54 pm IST.
India first imposed windfall profit taxes on July 1, 2022, and levied export duties of Rs 6 per litre ($12 per barrel) each on petrol and ATF and Rs 13 a litre on diesel.
A Rs 23,250 per tonne windfall profit tax on domestic crude production was also levied. The tax rates are reviewed every fortnight based on average oil prices in the previous two weeks. The government levies tax on windfall profits made by oil producers on any price they get above a threshold of $75-76 per barrel. The levy on fuel exports is based on cracks or margins that refiners earn on overseas shipments.
India first imposed windfall profit taxes on July 1
India first imposed windfall profit taxes on July 1, 2022, and levied export duties of Rs 6 per litre ($12 per barrel) each on petrol and ATF and Rs 13 a litre on diesel. A Rs 23,250 per tonne windfall profit tax on domestic crude production was also levied