Windfall tax on domestic crude cut

The Centre slashed the windfall tax on domestic crude by 21% to Rs 10,500/tonne, in the fifth fortnightly review of the one-off tax on oil companies, taking into consideration the cooling of global crude prices. It also cut the special levy on export of diesel by 37% to Rs 8.5/litre and rimmed the tax on jet fuel shipments by a steeper 44% to Rs 5/litre, as refining margins moderated from last revision.

The move will benefit state-run ONGC & OIL and private refiner Reliance Industries, which is the principal exporter of petroleum products.

The imposts were introduced on July 1, to ensure that the exchequer benefits from the windfall gains of oil companies due to elevated crude prices and refining margins. These levies have since been reviewed on a fortnightly basis.

The Indian basket of crude has moderated to $92.68/barrel on average in the first 15-days of September compared with the August average of $97.4/bbl.