COVID-19 impact: Oil, gas companies seek tax cuts, end to price controls

Oil and gas producers want the government to cut and defer taxes on output and end all price controls on domestic natural gas to help companies deal with the twin shock of a global supply glut and demand fall due to the Covid-19 pandemic.

Companies have separately and as part of industry body made representations to the government, seeking relief on payment of cess, royalty and profit petroleum. “At least for the next couple of quarters or until prices correct, the Indian upstream sector needs tax relief, which will help domestic production bounce back quickly. Cess should be abolished for Brent below $50,” Vedanta told ET.

Association of Oil and Gas Operators (AOGO) has separately written to the finance ministry demanding deferment and reduction in cess, royalty, and profit petroleum. It has also demanded “unrestricted marketing and pricing freedom for both oil and gas,” said secretary-general Ashu Sagar.

ONGC too has separately sought a waiver of cess, currently at 20% of the price, and full pricing and marketing freedom for domestic natural gas.

ET News
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