Posted May 18, 2023 19:09
MOSCOW (Reuters) – Reuters calculations showed on Thursday that Russia’s federal budget revenues from oil and gas sales could fall by about 55 billion rubles ($708 million) in May from April due to a cut in the profit tax on oil production.
According to calculations, oil and gas revenues may amount to 593 billion rubles, down from 648 billion in April and 886 billion in May 2022.
Falling income from oil – a major source of revenue for the budget – is likely to add to the already large budget deficit. Russia posted a deficit of 3.4 trillion rubles ($44 billion) in the first four months of the year as spending soared, not least because of Russia’s invasion of Ukraine, and falling energy revenues.
Russian oil and gas is subject to Western sanctions that limit sales to Western countries and also seek to impose a global price cap on Russian oil.
Finance Minister Anton Siluanov said on Wednesday that Russia’s oil and gas revenues were lower than expected.
Profits tax may drop to zero this month as taxpayers are allowed to pay it roughly once a quarter, which is not usually in May.
According to the Finance Ministry, the contribution of tax payments to the budget amounted to 221 billion rubles in March and 185 billion in April.
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At the same time, revenues from the mineral extraction tax on oil could rise this month by 128 billion rubles compared to its level in April, thanks to an increase in the prices of Russia’s Urals oil blend and the weakening of the ruble.
($1 = 77.7205 rubles)
(Prepared by Mahmoud Abdel-Gawad for the Arabic Bulletin – Edited by Ali Khafaji)
Written by: Reuters