The government increases the windfall tax on crude oil to $7,100 per tonne

The government has increased the windfall tax on petroleum oil from $4,250 per tonne to $7,100 per tonne as of tomorrow, August 15. The windfall tax on locally produced crude oil was fixed at 4,250 per tonne in the most recent fortnightly review. Additionally, the Special Additional Excise levy (SAED), or levy on exporting diesel, will increase from the current Re 1 per litre to 5.50 per litre.

The windfall tax on diesel has increased from 1 rupee per litre to 5.50 rupees per litre, and the tax on aviation turbine fuel has increased from 0 rupees per litre to 2 rupees per litre. The petrol windfall tax will continue to be zero. SAED for gasoline will remain at zero. Windfall profit taxes were first enacted in India on July 1, 2022.

The government increased the duty on petrol, diesel and aviation fuel exports in July of last year and imposed the windfall tax on crude oil producers as a result of private refiners choosing to profit from high refining margins in foreign markets as opposed to domestic sales.