Central government The government has reduced the windfall tax on domestic crude oil to Rs 5,200 per tonne from Saturday. It was earlier Rs 5,700 per tonne. The government issued a notification saying that the new rate will be applicable from June 1. The direct benefit of the reduction in windfall tax goes to companies producing crude oil domestically like ONGC and Oil India. Windfall tax on petrol, diesel and aviation fuel remains zero.
Tax is reviewed in 15 days
The government reviews the windfall tax on crude oil every 15 days. The windfall tax is reduced or increased based on the current crude oil prices at the international level. In the last few months, the government has reduced the windfall tax several times. Earlier on May 16, the government had reduced the windfall tax on crude oil from Rs 8,400 to Rs 5,700 per tonne. On May 1, it was reduced from Rs 9,600 to Rs 8,400 per tonne.
Windfall tax started being levied from 1 July 2023
The government had started imposing windfall tax from July 1, 2023 on the unexpected profits made by oil companies due to the sudden rise in crude oil prices. Along with crude oil, windfall tax has also been imposed on the export of petrol, diesel and aviation fuel. One of the reasons for introducing windfall tax was to control private oil refineries, which were exporting oil abroad bypassing supply in the domestic market due to good margins.
Input: IANS
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