Windfall tax: $12 margin hit for Reliance; govt to rake in Rs 1.3 trn

However, the earnings impact for RIL is likely to be less material given offsets from marking-to-market for current GRM strength, says a brokerage

The windfall taxes imposed by the government on domestic crude oil production and fuel exports will hit ONGC's earnings severely while shaving off up to $12 per barrel in refining margins for Reliance Industries Ltd. The new levies will give the government up to Rs 1.3 trillion additional revenue, brokerages said.

In a surprise move, the government on July 1 increased import duties on gold (by 5 per cent), added export duties on petrol and ATF (Rs 6/litre; $12 per barrel) and diesel (Rs 13/liter; $26/bbl) and slapped a windfall tax on domestic crude production (Rs 23,250 per tonne; $40/bbl).

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