On Friday (August 30), the central government decreased the windfall tax on domestically extracted crude oil to Rs 1,850 from Rs 2,100 per tonne. This tax is imposed as a Special Additional Excise Duty (SAED).
The Special Additional Excise Duty (SAED) on the export of petrol, diesel, and jet fuel, or Automatic transmission fluid (ATF), will remain unchanged at zero. As per an official announcement, the updated rates will be effective on August 31, 2024.
The windfall tax is applied to domestic crude oil when global benchmark prices exceed USD 75 per barrel. Furthermore, diesel, ATF, and petrol exports are subject to a levy if product cracks (or margins) surpass USD 20 per barrel. It’s important to note that product cracks or margins vary between crude oil (raw material) and finished petroleum products.
India introduced the windfall tax on July 1, 2022. Initially, each export duty of Rs 6 per litre (USD 12 per barrel) was imposed on petrol and ATF and Rs 13 a litre (USD 26 a barrel) on diesel. These tax rates are assessed biweekly based on average oil prices in the preceding two weeks.
Ready to invest like a pro? The Unicorn Signals app equips you with 100+ Free tools and knowledge you need to succeed. Download the Unicorn Signals app and gain access to daily stock lists, insightful market analysis and, much more!