CPM for imposing tax on windfall profits of pvt oil cos

New Delhi, May 28: Rejecting a hike in petrol price, the CPM on Wednesday asked the government to levy a 'windfall profit tax' on private, Joint Venture (JV) oil firms and private refineries.

"In no case can the UPA government pamper the private oil companies to make windfall profits and, at the same time, increase the price of petrol and diesel and burden the people further when they are suffering from steep price rise of essential commodities," CPM Politburo said in a statement.

It suggested the imposition of 'windfall profit tax' on private and joint venture oil producing firms as well as private standalone refineries "earning huge profits through import parity policy of pricing".

With crude prices passing 0 per barrel, "it is necessary that windfall gains be recovered from all private and joint venture oil producing companies like M/S Cairns, Reliance, Essar etc. extracting oil and gas in India," the statement said.

It added that when these contractors participated in the New Exploration Licensing Policy, "none of them could have envisaged crude prices beyond $ 30 a barrel."

"It would be a failure on government's part to allow upstream contractors additional gain of USD 70-80 per barrel without any extra work," the party said, adding that many other countries had "renegotiated their contracts with a threat of imposing windfall taxes on such profits."

"It is time that the government takes charge and recovers unintended gains from upstream contractors," it said.

ANI