Putin Aide Proposes $7.5 Billion Tax Hike for Mining, Chemicals Sectors – by Yuliya Fedorinova and Evgenia Pismennaya (Bloomberg News – August 10, 2018)

https://www.bloomberg.com/

The top economic adviser to Russian President Vladimir Putin proposed raising taxes on mining companies, including MMC Norilsk Nickel PJSC and Alrosa PJSC, among the largest producers of nickel and diamonds.

Additional budget revenues are needed to help pay for Putin’s promises to boost spending after his re-election this spring, according to a letter addressed to Putin and sent from Andrey Belousov, the Kremlin’s top economic aide.

The tax proposal could raise as much as 500 billion rubles ($7.5 billion) a year, according to the letter, which calculated rates based on profits from 2017. It would also affect chemical and fertilizer producers, the letter said.

Mining and other non-energy companies have benefited from a rally in commodity prices and drop in the value of the ruble, but aren’t paying taxes on this “excess income,” according to the letter, which was obtained by Bloomberg News.

The industry immediately pushed back against the proposal, saying it seem unfair. Executives are holding a meeting with the government on Friday to discuss the issue.

For the rest of this article: https://www.bloomberg.com/news/articles/2018-08-09/putin-aide-proposes-7-5-billion-tax-hike-for-russian-miners?utm_source=google&utm_medium=bd&cmpId=google

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