India government on Tuesday increased its windfall tax on crude oil exports by 4.41% to take effect on Wednesday.
Reports said the country initiated the windfall tax on the country’s oil producers and oil refiners who are exporting more due to the high international price of crude oil and refined products.
The windfall tax was originally set at 23,250 rupees per ton on oil producers and 6 rupees per liter on gasoline and jet fuel. The windfall tax on gasoil exports was set at 13 rupees per liter as India’s oil companies reaped the benefits of buying cheap Russian crude but selling in the high-priced global market.
A fortnight ago, India was said to be reconsidering its windfall tax on oil companies as oil prices began to ease. The authorities said the country would withdraw its windfall tax when oil prices fell $40 per barrel.
On July 20, the levy was reduced to 17,000 rupees per tone – today’s announcement lifts it again to 17,750 per tone, a Bloomberg report said.
The agency’s data showed last week that India was taking fewer barrels of Russian crude oil, easing by 18% in the four weeks to July 25, and down 30% from its peak in April and May.
China and India are perceived as major beneficiaries of the invasion of Ukraine by Russia since February, as subsequent Western sanctions saw both China and India race to scoop up discounted Russian crude, netting Moscow’s war coffers some $24 billion in March, April and May from sales to the two Asian nations alone, according to Reuters records.
Of the over 5.7million tones of petroleum exported by India monthly, a fair portion is believed to be sourced from Russia.