World Economy

Moscow Mulls Raising Tax on Oil, Gas Firms

Anton SiluanovAnton Siluanov

Russian Finance Minister Anton Siluanov said on Friday he wanted to increase taxes on the oil and gas industry by around 50 billion rubles ($787 million) a year.

Russia is the world’s biggest oil producer and its output has been rising to record highs despite low crude prices. The trend, supported by a weaker ruble, has caught the attention of the treasury, which needs revenues to cover a budget deficit, Reuters reported.

The current oil tax regime envisages a gradual increase in mineral extraction tax and export duties on heavy oil refining products, offset by a reduction in duties on exports of oil and high-grade refined products.

This year, however, the MET was increased as planned, but there was no corresponding reduction in oil export duty, angering the industry. Russia’s oil taxes are already among the highest in the world.

Speaking on the sidelines of the Moscow Finance Forum, Siluanov told reporters the finance ministry would propose increasing taxes on the oil and gas industry by about 50 billion rubles a year via tools such as MET.

“We are working with the energy ministry on how this should be spread out, which sectors (oil or gas) we will take this money from,” he said, without giving further details.

Siluanov also said the ministry planned to reach the same level of taxation for the gas sector as for the oil industry, in a step-by-step process.

“First of all, we are talking about Gazprom,” he said.