Oil companies compensate budget losses by increasing production at other fields – Interfax

Moscow. 20 Dec. INTERFAX.RU – the Ministry of energy and Ministry of Finance discuss a variant in which the oil companies compensate the budget shortfall in income from the new tax system the taxation of the additional income (NDD) increase oil production at other fields, said Minister of energy Alexander Novak in interview to the newspaper “statements“.

“the budget will be a revenue shortfall in the first year after the introduction of the NDM, and in subsequent years, on the contrary, the additional tax revenues due to production growth. The money and compensate the failure in the first year,” he said. “Now we are discussing with the Ministry of Finance to compensate for shortfalls in income in the first year. For example, our company can undertake to increase production at other fields, which will give additional incomes in the budget”,- said the Minister.

“we Have another fork with the Ministry of Finance: they propose to oblige the company to make a decision on the transition to PDM until the end of August 2017, despite the fact that tax can be applied from the beginning of 2018. Our proposal is to provide an opportunity for voluntary transition to the new tax system until January 2019, subject to the entry into force of the Federal law from January 1, 2018. Work to develop mutually acceptable variant will continue,” – said Novak.

As earlier reported, the Finance Ministry proposes to establish a system of demands for several existing fields in Western Siberia with proficiency from 20% to 80% on 1 January 2016 in the total amount of 15 million tons. In addition, a PDM system is proposed to apply for new fields in Western Siberia with the proficiency to 5% taking into account the special parameters for the calculation of NDM for them.

the Finance Ministry also offers companies voluntarily transfer on the PDM field, with benefits to duty or severance tax. The field should have only one benefit (either NDM or tax benefits under the current regime). Applications for transfer must be submitted before January 1, 2017.