Indian Government Increases Windfall Tax on Crude Oil for Fifth Time in 2024

The Indian government has once again raised the windfall tax on petroleum crude, this time to Rs 6,800 per metric tonne from Rs 4,900, marking the fifth increase since February. The tax, which is adjusted every two weeks, remains at zero for diesel and aviation turbine fuel. This move comes as part of efforts to curb private refiners from prioritizing overseas sales over domestic distribution to capitalize on higher refining margins. The tax was initially introduced in July 2022 on crude oil producers and exports of gasoline, diesel, and aviation fuel. The government's decision to raise the windfall tax aligns with its strategy to balance the interests of the oil industry and the economy.