India’s petroleum ministry raises “deemed duty”

The Indian Petroleum Ministry agreed in March to increase deemed duty from 7.5% to 10% for oil refineries with an upper cap at US$80 per barrel crude oil price in the global market. The Petroleum Ministry had earlier proposed to replace the deemed duty with a processing fee, which it withdrew upon approval of the duty increase. The ministry said it will monitor the operations of oil refineries upon implementation of the deemed duty formula, but admitted that it has not yet outlined a mechanism to do so. (March 5, 2009)