The Russian government may shuffle off part of the oil tax burden on consumers by raising excise duties on fuel, according to the results of a recent meeting chaired by Deputy Prime Minister Arkady Dvorkovich.
The Finance Ministry initially offered to raise the rate of the Mineral Extraction Tax (MET) on oil in 2017 by around $1 per barrel, or to 1,392 rubles from 473 rubles, which would allow to collect additional 238 billion rubles from the oil industry, resulting in around 200 billion rubles of net collections to the budget in the light of reduction of the profit tax.
Oil producers, however, proposed to raise the MET at a smaller pace and replace it with growth of excise duties on fuel. At present, excise duties on gasoline and diesel fuel amount to 10,130 and 5,290 per ton, respectively, and are to fall to 7,430 and 5,090 in 2017. Oil producers have proposed not to decrease the duties in 2017, which would give additional 97-100 billion rubles to the budget, while the MET would increase only by 243 rubles.
Another option proposed by oil producers implies raising excise duties on diesel fuel by around 1 ruble per liter, which would allow to raise the MET only by 128 rubles.
Under the third option, oil producers have proposed not to increase the MET at all and collect the required sum by keeping the excise duties at the 2016 level and from the export duty. This would require raising the export duty by 450 rubles per ton. (PRIME/Business World Magazine)