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Media: export duty to zero

СМИ: экспортную пошлину могут обнулить

The government intends to accelerate the tax maneuver is to zero the export duty, raise met and to introduce excise duty on crude oil. The Ministry of energy today discusses the reform of oil industry taxation.

Among the options to reduce export duty to zero, maybe in the near future, reported “Vedomosti”.

About the possible abolition of duty – after 2025 – said last year the Deputy Minister of Finance Ilya Trunin.

Now the government is pursuing a tax reform that aims to gradually increase the mineral extraction tax (this year – 857 rubles/ton, in 2017 – 919) while reducing the export duty to 30% from the current 42%.

To compensate for the loss to the budget from zero to 30% duty, mineral extraction tax should be increased in 1.5 times up to 1400-1500 rbl./t at $30-50/bbl., calculated chief economist at Vygon Consulting Sergey Ezhov.

Duties imposed to subsidize oil refining: they constrain domestic oil prices, which are calculated as the export price minus fees and shipping costs. The difference between the duties on crude oil and oil products (also proposed to cancel) stimulated the export of oil products, not crude oil.

Incentives have not helped, but rather has corrupted refineries, allowing them to produce and export fuel oil. Duties distort the pricing – with rare exception they are not anywhere in the world, says Director of the Moscow oil and gas center EY Denis Borisov.

“Sooner or later they need to cancel is archaic, says an energy Ministry official, – but is it worth to speed up this process, it is not clear”. If the cuts have already struck the oil refinery margin (through increase in the prices of raw materials), the zeroing can just kill.

If you just zero duty without changing other parameters, a minimum of 3/4 refinery will be beyond profitability, warns Borisov: capacity to replace the closed refinery, no. Duty did the Russian refinery are competitive in comparison with European, said Ezhov.

The second risk for the oilers, with the abolition of fees, will automatically be canceled preferential duties for certain fields. “This is just one of the problems, and we will try to solve it through the transition to PDM,” agrees energy Ministry official.

“We are against any sudden movements in taxation, – says the representative of one of the oil companies. – To plan activities, it is necessary that the rules of the game have been stable.”

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