On Thursday, the government reduced the windfall tax on locally produced crude oil and diesel exports, boosting the intraday share prices of Reliance Industries and ONGC by more than 1.5%. Shares of Reliance Industries began trading at Rs. 2,571 before rising more than 1.5% to reach an intraday high of Rs. 2,618. ONGC reached a high of Rs 150.5, an increase of 2% from yesterday’s NSE finish of Rs 147.45, before giving up part of its gains to trade at Rs 148.
According to a government statement, the windfall tax on crude oil produced by companies like ONGC (Oil and Natural Gas Corporation) has been reduced from Rs 4,900/t to Rs 1,700/t. High-speed diesel export taxes have been reduced from Rs 8 per litre to Rs 5 per litre. ATF tax has been decreased from Rs. 5 per litre to Rs. 1.5 per litre. On December 16, the new rates go into effect.
Since it was implemented, the government has updated the windfall tax every two weeks. The tax on locally produced oil has been decreased by almost 65% in the most recent revision. In response to an energy crisis, several countries started taxing energy companies’ higher-than-normal profits starting on July 1. India followed suit.
