Govt slashes windfall tax on fuel export, crude oil

NEW DELHI: The government on Wednesday scrapped a week-old tax on the export of petrol and cut windfall taxes on overseas shipment of diesel and ATF as well as the one imposed on domestically produced crude oil after global oil prices fell. While the Rs 6 a litre export duty on petrol was scrapped, the tax on the export of diesel and jet fuel (ATF) was cut by Rs 2 per litre each to Rs 11 and Rs 4 respectively, government notifications showed.

The tax on domestically produced crude was also cut to Rs 17,000 per tonne from Rs 23,250, a move to benefit producers like ONGC and Vedanta. Also, overseas shipments from refineries in export-focused ones were exempted from the levies that were imposed on July 1. On July 13, it was reported that the windfall tax review was expected following a sharp fall in global oil prices.

India imposed windfall taxes on July 1, joining a growing number of nations that taxes super normal profits of energy companies. But global oil prices have cooled since then, eroding profit margins at both oil producers and refiners.