Additional tax on crude oil likely

Finance Ministry is contemplating levy of additional cess on domestic crude oil, which would be accorded import parity upon dismantling of administered pricing mechanism from April one, 2002.

While it is proposed that domestic oil companies - Oil and Natural Gas Corporation and Oil India Ltd - would get market price from April 1, 2002, "the ministry of finance would separately work out the modalities to raise resources from the incremental gains accruing to them from the sale of indigenous crude," government sources said.

Domestic oil companies, which currently get an ad hoc price of Rs 5,570 per tonne - much lower than the entitlement of 82.5 per cent of import parity price for 2001-02, pay a cess of Rs 900 per tonne to the government.

Finance Minister Yashwant Sinha and Petroleum Minister Ram Naik were closeted for three-hours on Monday working out details on budgetary issues for APM dismantling, sources said.

"Only two issues now remain - guidelines for marketing of petroleum products and Regulatory Bill for marketing and distribution - which would be decided by the cabinet soon," he said.

PTI

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