Moscow. September 7. INTERFAX.RU – to Provide oil companies new additional benefits and increase compensation for the supply of fuel to the domestic market within the damping allowances in the excise tax on oil was unfair to the citizens of Russia, especially amid the increase in VAT to 20%, and discussion of pension reform. This was stated by the Director of Finance Alexei Sazanov at the Moscow financial forum.
“Given the fact that by the end of 2018 we will likely see growth of revenues for oil companies by more than 30%, net profit growth of two times, the growth of free cash flow in two and a half times. In these circumstances, to say that the state should take on additional surcharges for oil supplies to the domestic market, in relation to the citizens, who increased VAT from 18% to 20%, on the background of the discussion of pension reform is completely unfair”, he said.
“We can’t justify the additional benefits and payments to oil companies before the citizens of Russia”, – said the carp.
This issue was discussed at the session of the forum devoted to the completion of the tax maneuver in the oil industry and to introduce negative excise on oil from the damping component for the viability of the supply of petroleum products on the domestic market.
According to the law of the negative excise tax on oil, the government compensates oil companies to 50% of revenues from supplies to the domestic market. After the adoption of the law of energy took the initiative to adjust the damping allowance to fully offset the oil companies the cost of the supply of fuel to the domestic market. The energy Ministry argued its position that the margin of the oil refining industry is at a very low level.
“We see that oil refinery hard. Any sale into the market brings losses independent gas stations,” – said at the forum, Deputy Minister of energy Pavel Sorokin.
The Finance Ministry countered that in the current situation, the state compensation for half of the cost of supplying the domestic market for the oil companies is enough. “They say that you need to completely companies to offset the costs within the damping components, but in our opinion 50% to 50%, it is absolutely adequately. Current settings of the damping factor is optimal, and to revise them is not worth it,” said carp.
Oil companies, in turn, paid tribute to the government, which went into the introduction of damping premiums and reverse excise taxes on oil, but recalled that increasing excise taxes on petroleum products, ultimately passed on to consumers.
“When it comes to justice, we as a socially oriented company, we understand justice as he understands it, the Ministry of Finance. As you know, the excise tax is indirectly passed on to the consumer. As far as he (user – if) ready for this? At the present time created a mechanism that redistributes the load between the oil companies and the public. It is clear that the state seeks price regulation mechanism. In itself, the emergence damping allowances for companies already justice. It could never be, if you recall the development of the tax maneuver. Thank you for each ruble invested in production, modernisation, production and processing”, – said the first Vice-President of “LUKOIL” Alexander Matytsyn at the session of the forum.
Financial Director of “Gazprom oil” Alexander Yankevich added that it is necessary in the future to modify the damping rate not from the point of view of social responsibility of companies, and from the point of view of market conditions.
“I would like to have understood correctly – we are not asking for additional money from the budget, we understand social responsibility. We do not complain about the bad situation of cash flow. The problem is not that the industry earns too much or too little. But there are certain market factors that have impacted on the profitability of export-oriented industries. We care about the market – to have the right incentives in the market,” he said.
“As for the damper, we hope to dialogue about the mining mechanism. Hope for justice within the industry, between mining and processing. There are a number of nuances, the dialogue should continue, in terms of adjustments,” added jankiewicz.
Raising the retirement age
The draft law on pension reform adopted by the state Duma in the first reading. It provides for the raising of the retirement from 55 and 60 years for women and men to 63 and 65 years respectively. 29 August, Russian President Vladimir Putin in a televised address proposed to lower the bar increasing for women under 60 years. The reform of the pension system is scheduled to begin from 2019 to complete – by 2034.
Putin also stated the need to establish administrative or even criminal liability for employers for the dismissal of employees close to retirement age, and for the denial of employment in connection with age.
6 September “United Russia” submitted to the state Duma of the Russian Federation the first package of amendments to the pension reform.
The VAT increase to 20%
On 24 July the state Duma adopted in the third final reading the government’s law increasing from January 1, 2019 VAT from 18% to 20%.
According to the financial-economic justification to the law, the increase of VAT by 2% will further get a budget of 620 billion rubles a year.
The initiative also proposes to establish on a permanent basis the rates of insurance contributions for mandatory pension insurance is 22% (within limiting base value for the calculation of premiums for this insurance) and 10% higher than the adjusted limit values.
The law was signed by Putin on August 3.
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