RIL, ONGC shares rise as govt removes windfall tax on aviation fuel, petrol & diesel 

Shares of energy major ONGC and conglomerate Reliance Industries rose in the afternoon session on Monday after the Modi government scrapped the windfall tax on Aviation Turbine Fuel (ATF), crude products, petrol and diesel products.

RIL stock climbed 1.34% to Rs 1,311.05 against the previous close of Rs 1292.45 on BSE. Market cap of Reliance stood at Rs 17.72 lakh crore.

ONGC stock rose  0.52% to Rs 258.10 today against the previous close of Rs 256.75 on BSE. Market cap of ONGC stood at Rs 3.23 lakh crore in the afternoon session. 

The removal of windfall tax is likely to boost refining margins of these oil producers. 

"Notification nos 29/2024 and 30/2024 dated 2.12.2024 issued with immediate effect for withdrawal of windfall tax i.e special additional excise duty (SAED) levied on production of crude and export of ATF, SAED and Road and Infrastructure Cess (RIC) on export of petrol and diesel. Notification laid in the Parliament," said the Finance Ministry.

The windfall tax was imposed in July 2022 during a rise in global crude oil prices triggered by the Russia-Ukraine conflict. 

The windfall tax was revised every 15 days based on international crude oil prices. The tax rates were reviewed every fortnight, based on the average oil price in the last two weeks.

The tax formula was managed by the Department of Revenue and was adjusted according to changes in global oil prices.