The order stated that the windfall tax changes would go into effect on Friday, December 2.
On December 1, the Indian government announced that it had further reduced the windfall tax on exports of locally produced oil and fuel.
On locally produced oil, the windfall tax has been reduced to Rs 4,900 per tonne. while it has been lowered to Rs 6.5 per litre for diesel exports.
According to the order, the windfall tax changes will take effect on Friday.
The government implemented a windfall tax, also known as a special additional excise duty (SAED), on crude oil exports on July 1 to penalise the industry for the significant profits it has been making from the sale of refined crude on the world market. Its quantity is examined every two weeks.
On July 1, India introduced its first windfall profit tax, joining an increasing number of countries that tax energy companies' higher-than-average profits.
At the time, export taxes on gasoline, aviation turbine fuel, and diesel were each charged at the rate of Rs 6 per litre (USD 12 per barrel), and Rs 13 per litre (USD 26 per barrel).
On domestic crude output, a windfall profit tax of Rs 23,250 per tonne ($40 per barrel) was also imposed.
The windfall tax on domestic petroleum had an effect on producers, particularly the state-owned Oil and Natural Gas Corporation (ONGC) and Vedanta-controlled Cairn.
According to a previous report by news agency PTI, ONGC had urged the government to remove the profit tax on domestically produced crude oil and instead use the dividend route to access the robust earnings brought on by a rise in global energy prices.
Hardeep Singh Puri, the Union Minister for Petroleum and Natural Gas, had previously stated that the Finance Ministry was responsible for windfall tax and would continue to evaluate it every two weeks.
In the meantime, Tarun Bajaj, a former revenue secretary, recently told CNBC-TV18 that when oil prices decline, the windfall profits tax, which is levied on crude oil exports, will be reduced or eliminated.
According to Bajaj, "the windfall taxes will either reduce or go away as the prices come down."
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