Monday, July 7, 2008

Windfall Tax?

Just for the sake of extracting support from SP, I DON"T think the Govt will impose Windfall Tax on Pvt Oil cos like Cairn or RIL. Even though the SP support is cruical for the Govt to survive, two level headed persons in the UPA Govt namely the Prime Minister Dr.Manmohan Singh and the Finance Minister Mr.Chidambaram will use all their skill to scuttle such moves, it at all it comes up. Probably, in my analysis, the SP wants something different, but just to put pressure on the Govt, they are demanding (or rather suggesting) something. I do not see the Windfall Tax happening because it will have a chain effect, and will horrors of horrors oil refining business will suddenly look most dull business to do. And what will happen to the oil price (forget crude), the refining companies will find ways to extract their pound of profit in some other way, which will not make oil more costly and add fuel to the insurance fire.
Don't worry, be happy.

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