The Cabinet proposed to take into account the price of Brent oil when calculating export duties on Urals
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The Russian government proposed to take into account the cost of Brent oil when calculating export duties on Urals oil and limit the size of the discount on Russian oil, informed TASS with reference to the agency’s amendments to the law “On Customs Tariff”.
The new calculation method can be introduced from June 2023, the State Duma Committee on Budget and Taxes may consider the relevant amendments on April 17.
When calculating export duties, the price of Urals on the world commodity markets, as well as on the North Sea Dated, which is proposed to be monitored from April 15, can be taken into account. The price of Urals will be calculated as the average of daily oil prices for all days of trading in the Mediterranean and Rotterdam markets, North Sea Dated – in the North Sea market.
Happy April, 1 valid limiting the discount on Russian Urals oil in relation to Brent for the calculation of oil taxes. When calculating taxes, the discount in the price of Urals to the price of Brent oil will be limited to $25-34/bbl. The revised mechanism will be applied when calculating the mineral extraction tax (MET), additional income tax, excise tax on petroleum feedstock, as well as when calculating damper parameters in the oil industry.
According to the text of the document, if the price of Urals oil, calculated according to the current legislation, in April turns out to be less than the price of Brent oil by more than $34/bbl, then for tax purposes its price is taken as the price of Brent minus $34/bbl. In May, the discount is set at $31/bbl. (under a similar condition, i.e. if Urals is cheaper than Brent by more than $31/bbl), in June – $28/bbl, from July 1 – $25/bbl.
Since October 2022, the discount on Urals began to increase after the Western countries agreed on a price ceiling for Russian oil and oil products. The average monthly price for Russian oil in September 2022 was $68.25/bbl, in October – $70.62/bbl, in November – $66.47/bbl, in December – $50.47/bbl, in January – $49.48/bbl, reported the Ministry of Finance.
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