The central government has increased the windfall tax on the export of diesel and ATF, while reducing it on petrol. Amid rising crude oil prices, find out its impact on the common man.
The central government has increased the windfall tax on the export of diesel and aviation turbine fuel (ATF).
Conversely, the tax on petrol exports has been reduced. This decision comes at a time when crude oil prices are continuously rising in the global market.
According to the new order implemented by the government from July 16, the windfall tax on petrol exports has been reduced from ₹4 per liter to ₹2.5 per liter.
Meanwhile, the tax on diesel exports has been increased from ₹8.5 to ₹15.5 per liter.
The tax on Aviation Turbine Fuel (ATF) has also been increased from ₹7.5 to ₹14.5 per liter.
This decision comes as crude oil prices in the global market have risen for the fourth consecutive day due to growing tensions between the US and Iran.
On Thursday, Brent crude rose by 33 cents, or 0.4%, to $85.28 per barrel.
Meanwhile, US WTI crude was trading 42 cents, or 0.5%, higher at $80.02 per barrel.
In the last three trading sessions, Brent crude has jumped by about 12%, raising concerns about supply in the global oil market.
This change in windfall tax does not have an immediate direct impact on general customers.
This tax is imposed by the government when oil companies make extraordinary profits on exports due to high prices in the international market.
Its purpose is to bring a part of the profit into the government treasury and ensure the availability of fuel in the domestic market.
Despite the increase in windfall tax, there has been no change in the retail prices of petrol and diesel in the country. These prices have remained stable since May 25.
Aamir Makda, a commodity and currency expert at Choice Broking, believes that if tensions between the US and Iran escalate further, the price of crude oil could cross $100 per barrel.
According to him, the risk of oil supply disruption from Hormuz is creating concern in the market, which could lead to increased buying by investors.
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