-
Government increases windfall gains tax on crude, diesel and ATF
The government changed the windfall profits tax on Saturday, increasing the Special Additional Excise Duty (SAED) on crude oil by Rs. 3,150 per tonne and the SAED on diesel and air turbine fuel (ATF) by Rs. 2.5 per litre.
The new figures indicate that the levy on crude oil will rise from the previous Rs 1,900 per tonne to Rs 5,050 per tonne. The tax on diesel will rise from Rs. 5 per litre to Rs. 7.5 per litre.
According to the data, the tax on ATF will rise from Rs 3.5 per litre to Rs 6 per litre. In the interim, there will be no additional taxes on gasoline.
According to top government officials, the seven-month-old windfall profit tax on domestically produced crude oil and fuel exports is expected to generate about Rs 250 billion in the current fiscal year, which ends on March 31. The levy will continue for the time being because global oil prices are once again on the rise. “As of now, crude prices are again on the rise. So, for time being windfall tax will continue,” PTI quoted CBIC chairman Vivek Johri.
Separately, Revenue Secretary Sanjay Malhotra had stated that the budget had forecast the current fiscal year’s windfall tax collection at Rs 250 billion. Johri had stated that it would be “impossible to anticipate how long the windfall taxes will last” because of how unstable the geopolitical environment remained.
On July 1, India introduced its first windfall profit tax, joining an increasing number of countries that tax energy companies’ higher-than-average profits. At the time, export taxes on gasoline, ATF, and diesel were each charged at the rate of Rs 6 per litre (USD 12 per barrel), and Rs 13 per litre (USD 26 per barrel).
Additionally, a windfall profit tax of Rs 23,250 per tonne (USD 40 per barrel) was imposed on domestic crude production. Every two weeks, the levy is reviewed, and rates are adjusted by market oil prices.
The current windfall tax on crude oil generated by businesses like Oil and Natural Gas Corporation (ONGC) is Rs 1,900 per tonne. Crude oil extracted from the ground and beneath the seabed is refined and transformed into fuels such as gasoline, diesel, and aircraft turbine fuel (ATF).
Share This
