Russia to hit metals firms with $2.3 billion in export taxes

Russia is preparing new export taxes for steel products, nickel, aluminium and copper which will cost their producers $2.3 billion between 1 August and 31 December, its officials told a government meeting on Thursday, Reuters reports.

Moscow wants to protect its defence and construction industries from further growth in raw materials costs as prices for metals rise at a global level.

“Our economy is not ready for the kind of avalanche-like shock transfer of global prices to the domestic market that we have seen over the past year,” First Deputy Prime Minister Andrei Belousov said. “The increase in domestic prices for certain metals ranged from 60% to 100%.”

Moscow will use the August to December period, while the extra taxes are in place, to prepare a permanent mechanism to “accumulate part of the profits from these superfavourable market conditions”, the economy minister Maxim Reshetnikov said.

Taxing ferrous metals such as steel will bring in 114 billion roubles ($1.6 billion), and base metals such as nickel and aluminium 50 billion roubles, Belousov said, adding that that represents 20%-25% of the “excessive income” firms will get from a favourable market.

He said he believed the size of metals exports from Russia would remain unaffected by the tax.

The expected tax take is above Belousov’s previous estimate. He said in May that Russian metals producers could face a demand to pay 100 billion roubles in additional tax to the government for what he termed ‘screwing the state’.

Russia’s Nornickel, the world’s largest producer of refined nickel, and Rusal, the world’s largest aluminium producer outside China, as well as the main steel producers did not reply to a Reuters request for comment.

Similar articles

  • Russia goes to polls, Pro-Putin party seeks firm majority

    Russia goes to polls, Pro-Putin party seeks firm majority

    Russia goes to the polls on Friday to elect a new parliament in a three-day vote that the ruling United Russia party is expected to win despite a ratings slump after the biggest crackdown on the Kremlin's critics in years, news wires reported. The vote is a test of President Vladimir Putin's grip on power, according to Reuters.

    30
  • Dozens in Putin's inner circle at Kremlin tested with Covid ahead of elections

    Dozens in Putin's inner circle at Kremlin tested with Covid ahead of elections

    President Vladimir Putin announced on Thursday that dozens of people in his inner circle at the Kremlin had tested positive for coronavirus, AFP reported. Earlier this week, the 68-year-old Putin said he was self-isolating after announcing an outbreak among members of his entourage. "Cases of the coronavirus were detected in my inner circle. Not just one or two but several dozen people," Putin said, speaking via video link at a meeting of a Moscow-led security alliance.

    57