First of all a windfall tax is to be levied when a windfall occurs.Has a windfall occured?the answer is yes.It is noone's case that such a tax shd be levied always.So the USA withdrawal later example is meaningless. Secondly it is the argued that IT companies made a windfall and were not levied a windfall tax.But IT companies were not given a common propert resource like petroleum which belongs tto the Govt and the people. Thirdly contractual obligations are cited.You gave exploration rights with profit sharing on the assumption of certain oil prices.Upto 40 $ per Barrel this is fine.But beyond this it is a gross windfall.To argue that Govt gets a share via profit sharing is obtuse.You are the owner and you wish to be a beggar. Fourthly to cite capital costs for exploration as falling on the company,is plain ridiculous.You want a return on capital of 25% not 500%.This argument is plain ridiculuous.Who ever thought of this order of price increase? Fifthly the argument that WPT will discourage long term investment reveals a callous pro business view.We are talking of a crisis caused by the oil shock and the pain.Is it wrong to expect those who made such profits to share a bit of the pain.Noone is saying don't have profits but do not cash in on a windfall. The Ministry arguing the case against in this manner is a slap in the face of the common man.
RE:Re:5 reasons why windfall tax is right?
by ASHOK on Jul 17, 2008 01:58 PM Permalink
Today it looks Oil companies are making huge`profits. Which is true.
But just wait 6 months, everthing will become costly (i.e salary of people working in Oil Industry, cost of transportaion, cost of hotels,cost of drilling, cost of refinig etc.)
Than Oil industry profits will adjust down.
Experts who were paid 1000$ per day are demanding 1500$ per day. After levying WPT, how Govt wants to compensate all these overheads, which will be paid by Oil companies.
Concept of WPT is mooted by COMMIES who never had idea of economy.
Today system is BOOTSTRAPPED and you pull one end , you see the effect all over.
But for sure Commies never had an idea and that is how RUSSIA as well as CHINA sufferred.
Cuba /North Korea are other similar examples. Give me one example of a STATE controlled centralised economy working fine in this world and is COMMUNIST.
