Government Reduces Windfall Tax On Domestic Crude, Diesel, And ATF Exports, Fuels Optimism In Key Sectors

In a significant move the union government has decided to reduce taxes on some critical items, such as petroleum products and diesel.

Starting from 18 October, the special additional excise duty on crude petroleum has been brought down to Rs 9,050 per tonne, down from the previous Rs 12,100 per tonne, as reported by MoneyControl.

This adjustment comes shortly after the government had raised the windfall tax on crude petroleum to Rs 12,100 per tonne on 30 September.

The government has also lightened the tax burden on the export of diesel. The tax on diesel exports has been trimmed to Rs 4 per litre, down from the earlier Rs 5 per litre.

Moreover, the duty on aviation turbine fuel has been reduced to Rs 1 per litre, a significant drop from the previous rate of Rs 2.5 per litre.

These changes follow the government's introduction of windfall profit taxes in July 2022.

This tax reduction is anticipated to have a favorable impact on the petroleum industry, aviation, and diesel exports. It is expected to help make these markets more flexible and competitive, aligning with the evolving global energy landscape.