Home / Oil / Russia, which emptied the Treasury, and weighs the risks of a high tax on oil giants

Russia, which emptied the Treasury, and weighs the risks of a high tax on oil giants

Россия, казна которой пустеет, взвешивает риски высокого налога на нефтяных гигантов

“Against the background of the fountain of oil revenues, which rose President Vladimir Putin, weakened during the fall in oil prices, the Kremlin has found ways that allow the economy to slowly operate, albeit at slower pace, spending reserves from the collections of the black day and reducing wages and pensions,” writes The New York Times.

“Things got so bad, according to insiders that the Kremlin is thinking about how to smash the piggy Bank, which has always been considered inviolable, which could have long-term consequences for the Russian economy: to tax funds that own oil companies for investment, guaranteeing future oil production”, – said in the article.

“For the oil industry is tantamount to eating the seed corn”, – said the journalist Andrew E. Kramer.

“The situation is very serious”, – says Mikhail Krutikhin, an analyst at energy consulting company RusEnergy. According to his estimates, oil production in Russia, now being at a record post-Soviet period, $ 10.8 million barrels a day, will peak at some point next year and will start decreasing in the long term.

“The only question is the slope of this line, – he said. – Oil companies do not invest in the development of new deposits, because the revenues from these projects will come only after ten years. No one will invest in such projects”.

“This year, the new taxes will cost the oil companies about 200 billion rubles, or about $ 2.9 billion. But a far more tax, which, according to Russian media, can reach up to 11 billion dollars, is considered in the framework of the budget for 2017”, – writes the edition.

“Powerful industry and its allies in the energy Ministry oppose the tax increase, while no less influential faction in the government wants to raise taxes to keep budget spending at the current level, last but not least, on the army”, – is spoken in article.

“The Ministry of Finance, on the contrary, insists on new taxes on oil industry, while Russia is preparing for the revision of the budget for 2016, which will be in June”, – notes the edition.

The reduced role of oil industry is not so bad for Russia, with political and economic point of view, noted in an interview with former economy Minister Yevgeny Yasin. Russia should raise taxes on oil companies, even if this reduces the share of extractive industries in the economy in the future and make a priority other areas in which a strong Russia, such as education and science, he said.

“If we want Russia was a developed country, we should focus on the innovation economy, he added. Fat years has passed”.

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