18:07 GMT27 September 2020
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    Having analyzed the benefits of a so-called “Big Tax Maneuver,” the Russian Finance Ministry plans to cut export duties on oil and light oil products even further starting in 2018-2019, the tax department director of the Ministry of Finance.

    Last year, Russia began to gradually cut its oil export taxes over the course of three years, between 2015 and 2017.

    The move will gradually reduce export duties on oil and light oil products; at the same time, Russia will increase its mining extraction tax (MET) for oil and gas, as well as export duties for fuel oil, the energy news site Oilprice.com reported.

    Russia's export tax for crude oil is now stands at 42 percent, but it is expected to drop to 30 percent by 2018. Meanwhile, the MET will grow from the current level of 775 rubles to 918 rubles within the three-year period.

    "Export duties should be an emergency response, not part of the tax system," said Ilya Trunin, the tax department director of the Russian Finance Ministry.

    The tax reduction was partially introduced to align Russian export taxes with those of Kazakhstan, Russia's Customs Union partner. Additionally, the "tax maneuver" is expected to balance budget losses from export duties and provide new profits from the increase of the MET.

    Even though the prices of crude oil have halved over the last year, refining is still profitable for those who produce light oil products, according to Bloomberg.

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    Tags:
    Oil, mining extraction tax (MET), export tax, gas, Russian Finance Ministry, Ilya Trunin, Russia
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