Support The Moscow Times!

Oil Companies Ask Russian Drivers to Share Tax Hike Burden

Drpepperscott230 / Pixabay

Russian oil companies could shift the cost of new tax proposals onto consumers, the Kommersant newspaper reported Thursday.

Planned hikes to the Mineral Extraction Tax (MET) — where a company is taxed based on the amount of oil, gas, or other mineral extracted — are set to come into force in 2017.

The Russian Finance Ministry plans to gain 238 billion rubles ($3.7 billion) by increasing the base rate of severance tax on oil from 473 rubles ($7.20) up to 1,392 rubles ($21.30) per ton of oil. Export duties on oil are also set to increase, providing state coffers with another 55 billion rubles ($484 million), Kommersant reported.

Meanwhile, the government had planned to lower excise rates on gasoline and diesel from 1 million rubles ($15,340) and 529,000 rubles ($8,115) per ton, to 743,000 ($11,398) and 509,000 rubles ($7,808) per ton respectively. The move would have cost the treasury 200 billion rubles ($3 billion).

Oil companies are now asking that the lower excise rates be scrapped to offset rises to the MET, Deputy Prime Minister Arkady Dvorkovich said Wednesday.

Excise tax on gasoline has increased by 3 rubles ($0.04) a liter in 2016. Gasoline consumption in Russia fell in 2015 for the first time in 15 years.

Gasoline prices are predicted to grow by 5-6 percent, according to the Federal Antimonopoly Service (FAS), Kommersant reported.

… we have a small favor to ask. As you may have heard, The Moscow Times, an independent news source for over 30 years, has been unjustly branded as a "foreign agent" by the Russian government. This blatant attempt to silence our voice is a direct assault on the integrity of journalism and the values we hold dear.

We, the journalists of The Moscow Times, refuse to be silenced. Our commitment to providing accurate and unbiased reporting on Russia remains unshaken. But we need your help to continue our critical mission.

Your support, no matter how small, makes a world of difference. If you can, please support us monthly starting from just $2. It's quick to set up, and you can be confident that you're making a significant impact every month by supporting open, independent journalism. Thank you.

Once
Monthly
Annual
Continue
paiment methods
Not ready to support today?
Remind me later.

Read more