The central government has slashed the windfall profit tax levied on domestically-produced crude oil as well as on the export of diesel and ATF following a drop in global oil prices, according to an official order.
The said levy on crude oil produced by companies such as Oil and Natural Gas Corporation has been cut steeply to Rs 1,700 per tonne from Rs 4,900, the order dated December 15 said.
Crude oil pumped out of the ground is refined and converted into fuel like petrol, diesel and aviation turbine fuel (ATF). The government has also cut the tax on the export of diesel to Rs 5 per litre from Rs 8 and the same on overseas shipments of ATF to Rs 1.5 a liter from Rs 5.
The new tax rates are effective from December 16. The reduction in tax rate follows a 14 percent slump in global crude oil prices since November.