Windfall tax on crude and diesel up, export levy restored on jet fuel – Times of India

NEW DELHI: The Centre on Saturday raised windfall tax on crude produced from domestic fields by more than a third, doubled the export tax on diesel and restored the levy on outbound jet fuel shipment to mop up part of benefit accruing to the producers from the recent increase in global oil prices.
According to a government notification, the windfall tax on domestic crude pumped by companies such as state-run ONGC and Oil India Ltd was raised to Rs 11,000 per tonne from Rs 8,000.
The export tax on diesel was increased to Rs 12 per litre from Rs 5. This includes Rs 1.50 per litre road infrastructure cess.
A levy of Rs 3.50 per litre was slapped on jet fuel exports, which had been made tax-free the last fortnightly revision at the beginning of the month.
The taxes were reduced in two previous revisions in September in tune with the drop in international oil prices. Since then, however, oil prices have risen substantially. The mix of crude bought by India is currently averaging $92.9 per barrel this barrel against $90.7 last month.
The government had slapped the windfall tax and export tax in July, using India’s June crude cost of $116 as the base. While the windfall profit tax is calculated by taking away any price that producers are getting above a threshold, the levy on fuel exports is based on cracks or margins that refiners earn on overseas shipments. These margins are primarily a difference of international oil price realised and the cost.



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