Windfall profit tax on diesel exports, crude oil cut

The government on Monday cut the windfall profit tax on crude oil produced in the country and on exports of diesel. The tax, levied in the form of Special Additional Excise Duty or SAED, on domestically produced crude oil has been reduced to Rs 1,300 from Rs 5,000 per tonne, according to an official notification.

SAED on the export of diesel has been reduced to Rs 0.50 a litre from Rs 1 per litre. However, the levy on export of jet fuel or ATF has been hiked to Rs 1 per litre from nil earlier. SAED on petrol will continue to be zero. The new tax rates will come into effect from Tuesday.

India first imposed windfall profit taxes on July 1 last year, joining a growing number of nations that tax supernormal profits of energy companies. The tax rates are reviewed every fortnight based on average oil prices in the previous two weeks.