The government on Monday abolished the windfall tax on Aviation Turbine Fuel (ATF), Crude Products, Petrol and Diesel products after months of deliberations. This step has come into effect with immediate effect. After this decision, along with the country’s largest Reliance Industries, ONGC has also got relief. With this decision, we may see an increase in the gross refining margin of these companies. Windfall tax is a special tax on domestic crude oil production, which was introduced in July 2022 following rising global crude oil prices. So that revenue can be earned from the unexpected profits made by the producers.
Along with crude oil, the government has also withdrawn Road and Infrastructure Cess (RIC) on the export of petrol and diesel. Notification has been placed in Parliament. A notification has also been placed. In September, the Indian government announced the elimination of a windfall tax of Rs 1,850 per tonne on crude oil in August. Windfall tax on export of diesel and air turbine fuel was also abolished.
After this decision, there is a good rise in the shares of Reliance Industries. The company’s shares have seen a rise of about one and a half percent. Due to which the market cap of the company has seen an increase of up to Rs 24,500 crore. Let us also tell you what other information has been given by the government regarding windfall tax.
Why was it started
During the beginning of the Russia-Ukraine War and Western sanctions on the Kremlin, oil companies benefited greatly from the rise in crude oil prices. This profit created an environment where oil companies made significant, lump sum profits. In response to these extraordinary profits, India joined several other countries in imposing a windfall tax on domestic crude oil producers and exporters. The move was aimed at generating additional revenue for the government by imposing windfall taxes on domestic crude oil producers and exporters.
Increase in Reliance Industries shares
After this decision of the government, there is an increase in the shares of the country’s largest company Reliance Industries. According to the data, the company’s shares rose by about one and a half percent during the trading session and reached the day’s high of Rs 1311.05. However, after the closing of the stock market, the company’s shares were seen at Rs 1307.55 with a rise of 1.17 percent. In the morning, the shares of the country’s largest company opened at Rs 1291.65.
Earned Rs 24,492 crore this way
With the increase in shares of the country’s largest company Reliance Industries, it earned Rs 24,492 crore during the trading session. According to the data, when the stock market closed on Friday, the market cap of the company was Rs 17,48,991.54 crore. Which increased to Rs 17,73,483.47 crore due to the stock reaching its high during the trading session on Monday. This means that there has been a good growth in the market cap of the company.