Centre Slashes Windfall Tax On Crude Oil As Prices Slip Globally

The India government has cut the windfall tax on locally sourced crude oil to Rs 1,900 per tonne as oil prices have declined globally.

Centre has taken the decision to lower the windfall tax from Rs 2,100 per tonne after two weeks. The government has also reduced the additional excise duty on the export of aviation turbine (ATF) fuel to Rs 3,5 per litre from Rs 4.5 litre.

Additionally, the export duty on diesel has been reduced to Rs 5 per litre including cess from Rs 6.5 per litre, according to the Finance Ministry.

Meanwhile, oil prices declined in early trade on Tuesday due to the fears propagated by headlines of recession coming out from World Economic Forum’s meeting in Davos. Brent crude futures were down 38 cents or 0.5 per cent at USD 84.08 at 0114 GMT, extending a 1 per cent loss in the previous session, according to Reuters.

In India, the windfall tax was first imposed on 1 July. It was introduced as oil companies were reportedly making large profits due to high oil prices.

At the time, export duties of Rs 6 per litre was levied on petrol and ATF. While Rs 13 per litre was introduced for diesel.