WINDFALL TAX

WINDFALL TAX

The Indian government has cut the recently imposed cesses and levies on diesel and aviation turbine fuel (ATF) and removed the cess on exports of petrol due to softening in crude oil prices, amid fears of a global recession.

About windfall tax

A Windfall tax is imposed by a government against certain industries when they experience above-average profits due to economic conditions.

India imposed windfall taxes on 1 July, following the super normal profits of energy companies.

Reduction in taxes

Additional excise duties equal to 6 rupees per liter on exports of petrol have been removed.
Duties on the diesel exports have been cut to 11 rupees per liter from 13 rupees per liter earlier.
The cess by way of special additional excise duty (or windfall tax) on domestic crude being sold to domestic refineries at international parity prices has been cut to Rupee 17,000 per tonne from rupee 23,250 per tonne.
The export duty on Aviation Turbine Fuel has been lowered by rupee 2 to rupee 4 per liter.

Aim:

It mainly aimed at increasing local supplies and boosting its revenues.

Significance

The development comes in the wake of softening international oil prices which are expected to benefit the energy firms.
The move will offer relief for top fuel exporters like Reliance Industries and the state-run Oil & Natural Gas Corporation

Why did the Government Increase the Duties Earlier?

The government on 1st July 2022 imposed special additional excise duty on export of the petrol and diesel to address the problem of fuel shortage in the country.
Starting June 2022, fuel pumps across the country have been reporting huge fuel shortages, leading to their closure.
The situation of fuel shortage lead the government to increase the duties.
The move assured of enough fuel available in the country and asked oil marketing companies to ensure that their fuel pumps must remain open.

Source: The Indian Express

Join Our Telegram

KALI BEIN RIVER

SYNTHETIC BIOLOGY

India–Azerbaijan

05 Apr, 26
SHARE

A year after tensions arising from Operation Sindoor, India and Azerbaijan have taken steps to restore and normalise bilateral relations. The 6th round of Foreign Office Consultations, held in Baku, marked the first such engagement since 2022, signaling renewed diplomatic momentum. Recent Diplomatic Engagement During the consultations, bo

India–Australia Economic Cooperation and Trade Agreem

04 Apr, 26
SHARE

The India–Australia Economic Cooperation and Trade Agreement has completed four years since its signing. Both countries now aim to build on this progress through strengthened collaboration and ambitious targets, including reaching AUD 100 billion in bilateral trade by 2030. What is the India–Australia Economic Cooperation and Tra

ADR Report on Political Funding

03 Apr, 26
SHARE

A recent report by the Association for Democratic Reforms (ADR) analyses donations of ?20,000 or more declared to the Election Commission of India (ECI) by national political parties for FY 2024–25, highlighting transparency and accountability in political financing. Key Findings Massive Funding Surge Total donations to nationa

Maritime Chokepoints

03 Apr, 26
SHARE

Maritime chokepoints are narrow channels along global shipping routes where maritime traffic is concentrated. These points are geopolitically and economically critical, as they handle a large proportion of global trade, especially energy shipments. Current Relevance Over two-thirds of seaborne energy trade passes through a handful o

US-Israel-Iran War

01 Apr, 26
SHARE

Following the launch of Operation Epic Fury (U.S.) and Operation Roaring Lion (Israel), the geopolitical landscape has shifted fundamentally with the confirmed death of Iran’s Supreme Leader, Ayatollah Ali Khamenei.Iran retaliated through Operation True Promise 4, launching missile attacks against Israel and nearby Gulf states. The escala