Govt cuts windfall tax on oil
21 Jul 2022 15:55:12
New Delhi, Jul 21: The Centre has reduced windfall tax and exports levy after the oil prices have softened in the international market. The decision was taken after a review on Monday, officials said.
The Centre reduced the windfall tax on domestically produced crude to Rs 17,000 a tonne and cut the levy on diesel exports by Rs 2 and aviation-fuel exports would be cut by 2 rupees a liter.
It also exempted special additional excise duty levied on exports when done from the special economic zone.
"Central Government, on being satisfied that it is necessary for the public interest so to do, hereby exempts the excisable goods, when exported from units located in the Special Economic Zone (SEZ)," a notification said. The move will relieve top fuel exporters like Reliance NSE -1.03 % Industries and state-run Oil & Natural Gas Corp.
On July 1, the government imposed windfall gain taxes on the export of petrol, diesel, and aviation turbine fuel (ATF), and on the domestic production of crude oil. It has also mandated exporters to meet the requirements of the domestic market first. Following the government's announcement, Indian oil companies were to pay Rs 6 per liter (around $12.2 per barrel) on exports of petrol and ATF, and Rs 13 per liter (around $26.3 per barrel) on exports of diesel. At the same time, upstream producers will have to pay taxes of Rs 23,250 per tonne (around $38.2 per barrel) of crude oil produced in India.
The center had already announced that it would review the windfall tax every 15 days. Reliance and Rosneft-backed Nayara Energy Ltd., India’s only privately owned refiners, make up 80% to 85% of India’s overall gasoline and diesel exports.