The Russian government may introduce a new taxation regime for the oil sector, or a tax on added income, this year, but it will be applied only from 2018, according to the protocol of a recent meeting chaired by Deputy Prime Minister Arkady Dvorkovich.
The new tax will substitute existing tax incentives on some fields with a tax collected from the field’s cash flow. The new tax will allow the Finance Ministry to abolish the oil export duty and will add about 600 billion rubles of budget revenue.
The draft bill on the new tax is to be prepared by October 1. It will come in effect in 2017, but in fact it will be applied to oil fields only from 2018. The tax is to substitute preferences on oil export duty and the mineral extraction tax for green fields, but pilot projects to apply the tax on brown fields that do not use tax preferences are also planned.
Dvorkovich also ordered the Finance Ministry to develop special parameters of the new tax for green fields in West Siberia with a depletion rate of less than 5%. (Prime/Business World Magazine)
