(FE)
The central government on Wednesday hiked the windfall profit tax on exports of diesel and Aviation Turbine Fuel (ATF). Besides, windfall gains tax on domestically-produced crude oil was also hiked in line with the hardening of global prices. The revised rates are effective today (1 September). At the fourth fortnightly review, the government raised the windfall profit tax on the export of diesel to Rs 13.5 per litre from Rs 7 per litre earlier, and on Aviation Turbine Fuel (ATF) exports to Rs 9 from Rs 2 per litre, according to a Ministry of Finance notification. The tax on domestically-produced crude oil too has been hiked to Rs 13,300 per tonne from Rs 13,000 earlier.
The government reviews windfall gains cess every fortnight, according to global crude oil prices. The Indian government first imposed the windfall taxes in July, joining a select league of nations globally that tax supernormal windfall gains accruing to oil companies from soaring energy prices. Earlier, the government said that the main objective behind imposing the windfall tax is to maintain domestic supplies, as refiners preferred to export over supplying to meet the local requirements. The tax on exports has been raised in the latest review as margins rose, while the levy on domestically-produced oil has been increased marginally on slight changes in international crude prices and on expectations of a price rise on hopes of a production cut by the Organisation of the Petroleum Exporting Countries (OPEC) and its allies.
