The government has increased <a href="https://www.mid-day.com/news/india-news/article/india-raises-windfall-tax-on-crude-oil-to-rs-2-300-eases-levies-on-diesel-aviation-fuel-23327882" target="_blank" rel="none noopener">windfall taxes</a> on exports of diesel and aviation turbine fuel (ATF) while lowering the levy on petrol exports, for the fortnight commencing Thursday.
The rate of Special Additional Excise Duty (SAED) on diesel has been increased to Rs 15.5 per litre from Rs 8.5 per litre, while the levy on ATF has been raised to Rs 14.5 per litre from Rs 7.5 per litre, according to a Finance Ministry notification.
However, the export duty on petrol has been cut to Rs 2.5 per litre, from Rs 4 per litre.&nbsp;
The global oil benchmark Brent crude was trading at USD 84.69 per barrel in futures trade on Thursday.
The windfall tax was imposed to safeguard domestic fuel supplies during the <a href="https://www.mid-day.com/news/world-news/article/us-launches-fresh-strikes-on-iran-as-tensions-escalate-in-strait-of-hormuz-23640025" target="_blank" rel="none noopener">West Asia conflict</a> and to prevent exporters from making excessive gains due to the soaring global crude oil prices.
The government had revised the windfall tax on exports of petroleum products earlier this month by increasing the levy on petrol, while shrinking the duties on diesel and ATF.
The Special Additional Excise Duty (SAED) on petrol exports was at that time increased to Rs 4 per litre from Rs 1.5 per litre, whereas, the export duty on diesel was slashed to Rs 8.5 per litre from Rs 14 per litre, and for ATF it was reduced to Rs 7.5 per litre from Rs 12.5 per litre.
The government periodically reviews <a href="https://www.mid-day.com/news/india-news/article/govt-hikes-windfall-profit-tax-on-export-of-diesel-atf-raises-tax-on-domestic-crude-oil-23243745" target="_blank" rel="none noopener">windfall taxes</a> on domestically produced crude oil and exports of petroleum products to align them with changes in international crude prices and refining margins.
The existing duty rates on petrol and diesel cleared for domestic consumption remained the same.
The latest revision comes amid a sharp rise in global crude oil prices following an escalation in hostilities between the <a href="mid-day.com/news/world-news/article/us-launches-fresh-strikes-on-iran-as-tensions-escalate-in-strait-of-hormuz-23640025" target="_blank" rel="none noopener">United States and Iran</a>.
Oil prices climbed on Wednesday before easing slightly after US President Donald Trump reimposed a naval blockade on all Iranian ports, prompting Iran to launch retaliatory strikes on US infrastructure in the region.
<h2>What is windfall tax?</h2>
A wind fall tax is a levy that government imposes on companies or sectors that experience sudden surge in profits triggered by geopolitical conflicts or global supply shortages. It is done to mitigate economic volatility, while also generating revenue for the government. The latest revision comes amid surging global oil prices driven by the escalating US-Iran conflict.
(With Agency Inputs)

The Centre has hiked windfall taxes on exports of diesel and aviation turbine fuel by Rs 7 per litre, while reducing it by Rs 1.5 per litre for petrol 

Government raises windfall tax on diesel, ATF amid US-Iran conflict

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The government has increased windfall taxes on exports of diesel and aviation turbine fuel (ATF) while lowering the levy on petrol exports, for the fortnight commencing Thursday

Centre hikes windfall tax on diesel, ATF to boost domestic fuel availability

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