The government on Tuesday raised the windfall tax on export of diesel to 13 from12 per litre, and on jet fuel to Rs 5 from Rs 3.5 per litre, as refining margins increased in the last fortnight.
It, however, reduced the levy on domestically-produced crude oil to Rs 9,500 from Rs 11,000 per tonne, taking into account global crude prices moderation in the eighth fortnightly review of the one-off taxes on oil companies.
The Indian basket of crude oil price, which averaged $92.91/bbl in the first half of October, moderated to end the month with an average of $91.71/bbl.
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The taxes were introduced on July 1, as the government felt that the elevated crude prices were allowing oil companies to make windfall profits, and that the exchequer must get a share of such gains.
In the previous review a fortnight ago, the Centre had raised the windfall tax on domestically-produced crude oil to Rs 11,000 from Rs 8,000 per tonne, and the levy on export of diesel to Rs 12 from Rs 5 per litre, citing a rise in global crude prices in the fortnight. It had also reintroduced a levy of Rs 3.5/litre on export of jet fuel.
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The taxes move either way, depending on crude prices and the refining spread. While private refiners Reliance Industries and Rosneft-backed Nayara Energy are the principal exporters of diesel and ATF, the windfall levy on domestic crude targets producers like state-owned ONGC and Vedanta-controlled Cairn.
On July 1, the Centre imposed special additional excise duty of Rs 23,250/tonne on crude and export taxes on petrol, diesel and ATF at Rs 6/litre, Rs 13/litre and Rs 6/litre, respectively. The tax on petrol was removed subsequently. No windfall tax is applicable on exports from special economic zones.
