Govt may levy windfall oil tax on ONGC to moderate spiralling fuel prices

The revenues so collected would be used to pay fuel retailers so that they absorb spikes beyond the threshold levels

The government may levy a windfall tax on oil producers like Oil and Natural Gas Corporation (ONGC) as part of a permanent solution it is working on for moderating the spiralling retail prices of petrol and diesel.

The tax, which may come in form of a cess, will kick in the moment oil prices cross $70 per barrel, sources privy to the development said.

Under the scheme, oil producers, who get paid international rates for the oil they produce from domestic fields, would have to part with any revenue they earn from prices crossing $70 per barrel mark.