Govt cuts windfall tax on crude oil to Rs 5,700

New Delhi: The Central government has cut the windfall tax on petroleum crude to Rs5,700 ($68.34) per metric ton (MT) from Rs8,400 with effect from Thursday, as part of its fortnightly revision that is calibrated with global prices.

This is the second fortnightly cut in windfall tax in a row after a Rs8,400 per metric ton reduction from Rs9,600 on May 1. Upstream oil exploration and production companies ONGC and Oil India Ltd will gain as they will have to pay a lower tax on their crude oil output. The tax has been scaled down as crude oil prices have declined in the international market and the earnings of oil producers have also come down. Prices of the benchmark Brent crude are currently hovering at a little over $82 per barrel.