Oil industry proposes to Russia’s President to increase tax burden on Gazprom

Oil companies have proposed to increase tax burden on the gas industry in order to increase the State budget revenue. That is according to “Vedomosti” citing its sources.

On September 22 Russian President Vladimir Putin held a consultative meeting on budget. Following the meeting the President gave instructions to elaborate on the issue of directing additional amount of revenues to the budget that exporting companies receive as a result of the ruble devaluation.

According to “Vedomosti”, Vladimir Putin asked the Government to consider tax burden increase on the oil industry which, in turn, proposed to take the money from gas industry workers.

The media does not provide any details on the tax burden increase on the gas industry. In the words of Vedomosti’s interlocutor, this is just an idea and it is unclear whether or not the Government should welcome it. The interlocutor also informed that the measure pertains to Gazprom only as only the exporting monopolist has devaluation-based revenue.

As previously reported, according to the IFRS (International Financial Reporting Standards) Gazprom’s net profit attributable to the shareholders decreased by 86% in 2014 compared with 2013 and amounted to 159 billion rubles.

Gazprom said in a statement that the reduction of revenue was driven by many factors. For instance, cost growth related to the foreign exchange difference that had been caused by the ruble weakening against the dollar and euro (pure loss increased by 925 billion rubles).

At the same time, net revenue from oil and gas sale to Europe increased by 69 billion rubles (4% on a year on year basis) and amounted to 1,752 trillion rubles.