Export-focused refineries have been exempted from this latest notification
The Centre on July 1 raised taxes on the export of petrol, diesel, and aviation turbine fuel (ATF), along with the announcement of an additional windfall tax on gains made by domestic refineries. The government slapped a Rs 6 per litre tax on exports of petrol and ATF and Rs 13 per litre on exports of diesel.
It imposed Rs 23,230 per tonne additional tax on domestically produced crude oil to take away windfall gains accruing to producers from high international oil prices, a separate government notification showed.
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“Govt has taxed only partial of windfall gains refiners were making. Govt has left some gains untaxed for the refiners as well,” official sources told CNBC TV-18.
However, export-focused refineries have been exempted from this latest notification regarding domestic sales. The mandate demands that exporters sell 30 percent of their diesel output locally, first.
Reliance Industries, which has the largest refinery in the world in Jamnagar, slumped 7 per cent to trade at Rs 2,400 level, its largest fall since December 2021. It single-handedly took the market down as well.
Mangalore Refinery and Chennai Petroleum were also down about 8 per cent each. Both stocks had gained recently thanks to the improving outlook on exports of petroleum products. ONGC and Vedanta that have oil rigs in India were down 5 per cent each.
The tax on exports follows oil refiners, particularly the private sector, reaping huge gains from exporting fuel to markets such as Europe and the US.
Disclaimer: Moneycontrol is a part of the Network18 group. Network18 is controlled by Independent Media Trust, of which Reliance Industries is the sole beneficiary.
