New law will not impose windfall tax on oil firms, clarifies Centre

Union Petroleum Minister Hardeep Singh Puri on Thursday made it clear that the oil and gas companies will not face any new taxes like the windfall profits tax after the coming into effect of a new law that promises stability of the fiscal regime.

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With the aim of providing policy stability, decriminalising provisions and promoting ease of doing business, the Parliament has passed the Oilfields (Regulation and Development) Bill, 2024.

Speaking at a reception he hosted to celebrate the passing of the Bill in New Delhi, Puri said, “After this Bill, it will be difficult to levy new taxes such as windfall tax because somebody will sue us for failing to keep the promise of fiscal stability.”

He said investors looking to invest in finding and producing oil and gas wanted fiscal stability, and new taxes that sought to take away gains made when prices were high, without compensating for low or no margins when rates were low, were often a deterrent.