The Centre on Thursday cut the windfall profit tax on domestically produced crude oil from Rs 5,050 per tonne to Rs 4,350 per tonne. The additional excise duty on ATF was also cut to Rs 1.5 per litre from Rs 6 per litre earlier.
Further, the government also slashed tax on export of diesel to Rs 2.5 per litre from Rs 7.5 per litre. Petrol continues to have zero excise duty. The new rates will come into effect on February 16.
The windfall tax was first imposed on India first imposed windfall profit taxes on July 1, 2022 and is expected to continue due to high prices. It is likely to give about Rs 25,000 crore in the current fiscal ending March 31, top government officials said earlier this month to PTI.
"As of now, crude prices are again on the rise. So, for time being windfall tax will continue," CBIC Chairman Vivek Johri said.
Separately, Revenue Secretary Sanjay Malhotra said the budget has estimated collection from windfall tax at Rs 25,000 crore in the current fiscal.
As the geopolitical situation continues to be volatile, Johri said, it would be "difficult to predict how long the windfall taxes will continue".
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Windfall tax is levied by Centre on profits made by oil producers on any price they get above the rate of $75 per barrel.