petrol-diesel
After the common people got a shock on petrol and diesel, now the profits of petroleum companies have also got a big shock. The government has taken a big decision to curb foreign profits of petroleum companies. The government imposed a windfall gains tax of Rs 3 per liter on the export of petrol. This is a big blow to the petroleum companies. This means that if a petroleum company exports petrol abroad, the government will have to pay a tax of Rs 3 per liter on the income earned from it. On the other hand, there is some relief news also. The levy on diesel was reduced to Rs 16.5 per liter and on aviation turbine fuel i.e. jet fuel to Rs 16 per liter. These rates will be applicable from 16th May i.e. today.
Government notification
The Finance Ministry said in a notification that road and infrastructure cess on export of petrol and diesel will be zero. Apart from this, there has been no change in the existing duty rates on petrol and diesel released for domestic consumption. For the first time since the beginning of the West Asia crisis, a special additional excise duty (SAED) of Rs 3 per liter has been imposed on petrol. Duty on export of diesel has been reduced from Rs 23 per liter to Rs 16.5 per liter and on aviation turbine fuel from Rs 33 per liter to Rs 16 per liter.
On March 26, the government had imposed export duty of Rs 21.50 per liter on export of diesel and Rs 29.5 per liter on ATF. In the review held on April 11, these duty rates were increased to Rs 55.5 per liter and Rs 42 per liter. In the review held on April 30, these duty rates were reduced to Rs 23 per liter and Rs 33 per litre.
Crude oil price crosses 100 dollars
This windfall tax was imposed with the aim of increasing domestic availability of fuel during the ongoing war between America, Israel and Iran. Another objective of this was to prevent exporters from taking unfair advantage of the difference in prices, because global crude oil prices had increased since the beginning of the war. On February 28, the US and Israel launched military strikes against Iran, in response to which Tehran retaliated strongly.
For the last one week, crude oil prices have remained above $100 per barrel, whereas before the war these prices were around $73 per barrel. The ministry said that in the backdrop of the West Asia crisis, this windfall tax was imposed to ensure domestic availability of petroleum products by discouraging exports.
