Oil, gas producers may seek uniform taxes across blocks

Relief from state levies among other demands

- SUBHAYAN CHAKRABORTY

In the runup to the Budget, upstream oil and gas companies have called for a review of the taxes levied on older oil blocks, which account for nearly 90 per cent of domestic production, according to officials from two large exploration and production (E&P) firms.

The removal of a number of cesses imposed by states, exemption from Customs duty on a larger set of imports, and greater ease in exploration are among the key issues raised during discussions with the government.

In meetings with the finance and petroleum ministries, the industry has urged the government to align taxes imposed under previous regimes, such as New Exploration Licensing Policy (NELP) and Pre-NELP, on a par with the current Hydrocarbon Exploration and Licensing Policy (HELP) regime.

The NELP replaced the nomination regime in 1999 and remained in place until 2017, when the HELP regime came into force. The industry has asked the government to rationalise taxes from the current levels of over 60 per cent to 40 per cent, in line with global benchmarks.