The windfall tax on domestic crude oil has been increased by nearly 40 per cent to Rs 6,800 per tonne from Rs 4,900 per tonne earlier as global crude prices surged, the finance ministry said.

The government has raised the windfall tax on petroleum crude for the fifth time since February.

The windfall tax, which is revised fortnightly, remains at zero for diesel and aviation turbine fuel.

The tax is levied in the form of Special Additional Excise Duty (SAED).

The tax rates are reviewed every fortnight based on average oil prices in the previous two weeks.

The average price of Indian crude basket per barrel increased from $79.22 in January to $81.50 per barrel in February and ended the fiscal year $84.49 in March. And, for the whole fiscal, it averaged $82.58 per barrel.

The increase has come in the backdrop of the rise in global crude oil prices on supply concerns and Houthi attack in Red Sea,

Besides, the meeting of top OPEC+ ministers kept oil supply unchanged and pressed some countries to increase compliance with output cuts, a decision that spurred international crude prices to their highest in five months at nearly $90 a barrel.

India first imposed windfall profit taxes on July 1, 2022, joining a growing number of nations that tax supernormal profits of energy companies.

At that time, export duties of Rs 6 per litre ($12 per barrel) each were levied on petrol and ATF and Rs 13 a litre ($26 a barrel) on diesel.

A windfall tax is levied on domestic crude oil if rates of the global benchmark rise above $75 per barrel.

Export of diesel, ATF and petrol attract the levy if product cracks (or margins) rise above $20 per barrel.