The government reduces windfall gains tax on domestically produced crude to Rs 5,700 per tonne
The government reduced the windfall gains tax on domestically produced crude on Wednesday. The tariffs have been reportedly slashed from Rs 8,400 per tonne to Rs 5,700 per tonne. Meanwhile, there will be no export duty levied on petrol, diesel, and aviation turbine fuel (ATF) as before.
As per the Central Board of Indirect Taxes and Customs (CBIC), the revised rates will come into effect from May 16, 2024.
On May 1 as well, the government had reduced the windfall tax on domestically produced crude oil from Rs 9,600 per tonne to Rs 8,400 per tonne.
This tax is imposed as a Special Additional Excise Duty (SAED). It is usually a one-time tax levied when companies incur high revenue.
In April 2024, the tax on petroleum crude went up quite a bit. First, it jumped from Rs 4,900 to Rs 6,800 per metric ton on April 4. It then soared even higher to Rs 9,600 per metric ton on April 16. This increase came after a previous hike in March, when the tax rose from Rs 4,600 to Rs 4,900 per metric ton over the month.
India had first joined the ranks of nations imposing windfall profit taxes in the year 2022. This was largely done to keep a check on the excessive profits made by energy companies. These taxes are subject to review every two weeks, as it takes into account international crude oil prices from the previous fortnight.