Windfall Tax: Vedanta Deducts $91 Million From Govt's Profit To Make Up For Tax Paid

In signs of protests against the 9-month-old windfall tax, mining mogul Anil Agarwal's Vedanta Ltd has withheld about USD 91 million from the share of profit due to government from its oil and gas fields, to make up for the additional tax outgo, according to sources and correspondence on the issue, PTI reported.

India first imposed windfall profit tax on July 1, 2022 joining a growing number of nations that tax super normal profits of energy companies. But the levy of Special Additional Excise Duty (SAED) on locally produced crude oil was seen by producers as violation of the contract which provides fiscal stability.

The SAED initially was Rs 23,250 per tonne (USD 40 per barrel) and in fortnightly revisions brought down to Rs 3,500 per tonne.

This comes on top of the 10-20% royalty on the price of oil and gas realised and the 20% oil cess. In addition, the government is also entitled to a predetermined portion of the profits that remain after deducting costs from the proceeds from the sale of oil and gas.

Vedanta's stock last traded at Rs 269.75 apiece, down 0.55% as compared to its previous close of Rs 271.25 apiece. The stock reported its 52 week high at Rs 440.75 apiece and 52 week Low at Rs 206 on NSE, respectively.