Centre cuts windfall tax on crude oil output and diesel exports

India on Thursday cut the windfall tax on crude oil to Rs 4,900 ($60.34) per tonne, according to a government order.

It also cut the export tax on diesel to 8 rupees per litre. Changes to the windfall tax will be effective from Friday, the order said.

The windfall tax is a special tax imposed by a government on a company or industry when it benefits from something but not responsible for the financial gain that ensues is called windfall profits.

India first imposed windfall profit tax on July 1, joining a growing number of nations that taxed super normal profits of energy companies. But international oil prices have cooled since then, eroding profit margins at both oil producers and refiners.

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