Government Eliminates Windfall Tax on Crude Oil, New Rates Implemented

New Delhi: The central government has reduced the windfall tax on domestically produced crude oil to zero amidst fluctuations in international crude oil prices. Additionally, the special additional excise duty on the export of petrol and aviation turbine fuel (ATF) remains unchanged at zero. The new rates are effective from Wednesday.

According to the government's notification, the windfall tax on domestic crude oil has been cut from ₹1,850 per ton to zero. The special additional excise duty on the export of petrol and ATF has also been maintained at zero. Previously, on August 31, the windfall tax on domestically produced crude oil was reduced from ₹2,100 per ton to ₹1,850 per ton.

It is noteworthy that the windfall tax is notified every fortnight based on average oil prices over the preceding two weeks. The windfall tax was first introduced in India on July 1, 2022, making India one of the countries that impose taxes on unexpected profits of energy companies.