The Central Government has increased the windfall tax on petroleum crude from Rs. 4,900 to Rs. 6,800 per tonne in one swift move with effect from 4th April 2024. The duty has been raised by Rs. 1,900 in one shot. The government vide notification no. 11 /2024 – Central Excise dated 3rd April 2024 has surpassed the previous notification issued on 15th March 2024.
On July 1, 2022, India joined a group of nations implementing windfall profit taxes, mirroring the practice of several other countries aimed at taxing unusually high profits garnered by energy corporations.
In continuation of recent governmental adjustments, a significant change was implemented on February 3, 2024, with the windfall tax on petroleum crude rising to ₹3,200 per tonne. Subsequently, on March 15, 2024, it underwent further escalation to Rs. 4,900, marking a substantial increase this time.
The windfall tax targets unanticipated or excessive profits, typically levied on sectors experiencing significant gains. Its purpose is to reclaim surplus earnings generated by companies due to unforeseen market conditions. This latest hike is poised to adversely affect the industry, given the heightened duty.
Furthermore, the future of petroleum crude is uncertain, as it can fluctuate unpredictably, experiencing both ups and downs.
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