Bloomberg Anywhere Remote Login Bloomberg Terminal Demo Request


Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the world.


Financial Products

Enterprise Products


Customer Support

  • Americas

    +1 212 318 2000

  • Europe, Middle East, & Africa

    +44 20 7330 7500

  • Asia Pacific

    +65 6212 1000


Industry Products

Media Services

Follow Us

Putin Says Natural-Gas Producers May Face Higher Tax Burden

President-elect Vladimir Putin urged the government to raise taxes for producers of Russia’s resource wealth, particularly natural gas, without stifling spending to develop new deposits.

“There are sectors where the low tax burden is economically unjustified and often not fair socially,” Putin, the prime minister, said today at a government meeting in Moscow today, singling out gas producers. The government must act carefully and “in no way undermine our resource companies’ investment plans.”

Russia is seeking additional funds to pay for Putin’s electoral promises to raise salaries and pensions. Oil and gas contributed half of the country’s budget revenue last year. Putin won a return to the Kremlin for six years in Russia’s March 4 election after four years as prime minister.

Increases in the gas extraction tax may add 200 billion rubles ($6.8 billion) to the budget in 2013 and 2014, Vedomosti reported yesterday, citing Deputy Finance Minister Sergei Shatalov. Both OAO Gazprom, the state-run exporter, and independent producers that sell gas only in the domestic market, such as OAO Novatek, will have to pay higher levies, the newspaper reported.

‘Swept Along With Gazprom’

Gazprom’s mineral extraction tax rate rose 61 percent per 1,000 cubic meters of fuel produced last year and doubled this year. The Finance Ministry has planned to boost Gazprom’s tax rate 14 percent next year and 7 percent in 2014.

In February, Gazprom said the higher levy will shave 64 billion rubles from profit this year alone, and eat up all the gain as the government increases regulated prices at home.

“Gas taxes for Gazprom appear to be set to rise substantially not from 2015, the conventional wisdom on the street, but from 2013, and the independents may well be swept along with Gazprom,” Ron Smith and Alexander Bespalov, analysts at Citigroup Inc, said in a research note yesterday.

Gazprom shares retreated as much as 2.8 percent and traded down 2.4 percent at 170.26 rubles at 5:35 p.m. in Moscow, heading for the lowest close this year. Novatek, Russia’s second-biggest gas producer, advanced 0.1 percent to 374.59 rubles.

The government may raise the mineral extraction tax on July 1, 2013, to provide an additional 50 billion rubles for the budget that year, and twice in 2014, adding 150 billion rubles, Shatalov said, according to Vedomosti.

“The 2013 budget debate cannot get started in May without clarity on what gas sector taxation as this is a major budget revenue line,” Luis Saenz, chief executive officer of the U.S. unit of Moscow-based brokerage Otkritie Financial Corp. wrote in a note yesterday. “The visibility on gas sector taxation is uncomfortably low.”

Please upgrade your Browser

Your browser is out-of-date. Please download one of these excellent browsers:

Chrome, Firefox, Safari, Opera or Internet Explorer.