Govt removes Windfall Tax on Crude Oil Production:

Govt removes Windfall Tax on Crude Oil Production The Indian government has declared that the windfall tax on crude oil production will be abolished, effective Tuesday, from the previous rate of 3,500 rupees ($42.56) per tonne. On July 1, 2022, India placed a windfall tax on crude oil producers as well as levies on gasoline, diesel, and aviation fuel exports.The windfall profit tax on the export of petrol and aircraft turbine fuel (ATF) was 6 per litre, and 13 per litre on diesel. A windfall profit tax of Rs 23,250 per tonne was also levied on domestic crude output. According to the most recent notice, the windfall tax on diesel has been reduced from Rs 1 per litre to Rs 0.5 per litre. Petroleum and ATF are not subject to a windfall levy. Windfall tax is a higher tax levied by the government on particular industries when their profits are unexpected and above-average. When an industry's revenue suddenly increases, the government applies this tax.The recent Russia-Ukraine conflict benefited the oil and gas industries, causing the government to levy a windfall tax on these industries. The government made this critical decision at a moment when OPEC+ decided to reduce output. Brent rose nearly 6% to USD 84.58 per barrel on Monday as a result of the shift. The government also reduced the tariff on diesel exports to 50 paise per litre, while levies on aviation turbine fuel (ATF) and petrol exports remained nil.