Income Tax: The central government started imposing windfall tax on domestic crude oil production in July 2022. This tax was introduced by the government in July 2022 after the rising prices of global crude prices.
The central government has given a big relief to crude oil extracting companies by abolishing the windfall tax. After several months of deliberations, on Monday, the government has abolished the windfall tax on aviation turbine fuel (ATF), crude products, petrol and diesel products. This move is going to give relief to oil group companies Reliance and ONGC with immediate effect. The government started imposing windfall tax as a special levy on domestic crude oil production in July 2022. This tax was introduced by the government in July 2022 after the rising prices of global crude prices, to get revenue from the unexpected profits made by the producers.
Government gave information in Parliament
Apart from this, the government has also withdrawn the Road and Infrastructure Cess (RIC) on the export of petrol and diesel. A notification regarding this has also been placed in Parliament. In September, the Government of India announced the abolition of the windfall tax on crude oil from Rs 1,850 per tonne in August. Apart from this, the windfall tax on the export of diesel and aviation turbine fuel was also abolished.
What is Windfall Tax
Windfall Tax does not affect the common man in any way. Actually, it was levied on companies producing crude oil domestically. The government had imposed windfall tax on their export on July 1, 2022 to control the prices of petroleum products in the domestic market.
Windfall tax was imposed on oil companies in such circumstances when they got special benefit due to some situation. In February 2022, after the Russia-Ukraine war, there was a surge in crude oil prices. Oil companies benefited a lot from this, so windfall tax was imposed on them.
