Details on Oil Tax Tweaks Emerging | Business | The Moscow Times:
"The Finance Ministry has proposed gradually reducing oil export duties and increasing the mineral extraction tax, or MET, in a move to boost state revenues that could stimulate exports and drive up domestic fuel prices.
The ministry needs to find new revenue sources to cover President Vladimir Putin's promises to spend more on social benefits, the armed forces, the 2014 Winter Olympic Games and the 2018 soccer World Cup.
Although tax relief is being offered on some projects, such as extracting hard-to-recover tight oil, the increase in MET would squeeze the profit margins earned by oil refiners who in turn would seek to pass on the cost to drivers.
"Crucially, the proposed change would lead to a rise in domestic motor fuel prices, something the government will try to avoid at any cost," Vienna-based JBC Energy consulting firm said in a note earlier this week."
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