"We do not expect price hikes in connection with the adoption of the law because it concerns the exempted part of earnings which remain after oil exports and does not affect domestic prices," said Mr. Shatalov.
Domestic prices for petroleum products do not depend on the rate of the tax for the production of mineral resources, he stressed.
Additional profits from a higher rates of tax on the production of mineral resources and export duties will be directed to the Stabilization Fund under the State Treasury, he said.
"This measure has a clear economic and social meaning," Duma Speaker Boris Gryzlov told an interparliamentary conference of the supreme legislatures of Russia and Ukraine, held in the Crimea.
From the economic point of views, the law is aimed at "leveling the profitability of the oil industry with average industrial profitability and taking 'the non-working' part of the profits gained from the industry," he said.
He thinks that from the social point of view, the adoption of the law means the implementation "of the principle according to which profits from a higher rate of tax for the production of the country's mineral resources must be distributed among all the citizens of the country."
The new export customs duties for oil will come into force on August 1, 2004, while the new rate of the tax on the production of mineral resources comes into force on January 1, 2005.
