Moscow in talks with aluminum companies over new mining tax
Several sources with knowledge of the situation said Reuters This week, talks between the Russian government and producers of aluminum and other metals and fertilizers have yet to reach a consensus on how best to implement Moscow’s new commodity tax structure.
A half-dozen separate sources told the news service that the meeting, which took place on Wednesday, focused on establishing a metal mining tax (MET) on aluminum, bauxite and other producers of metals and fertilizers on the basis of world commodity prices.
The Russian government previously imposed a temporary import tax on aluminum, copper, nickel and steel to be collected for the last five months of the year. Estimates of the revenue generated by the tax amount to $ 2.3 million, which Moscow justifies as a method to “accumulate part of the benefits of these superfavorable market conditions”.
“The Ministry of Finance always seems to have a tendency to increase the MET on a ‘fair’ basis – a flexible rate that takes into account world income and prices,” a source relayed to Reuters who was present at the meeting. The source added that no calculation has yet been announced.
“The company proposed to leave the MET as it is and base a” fair “tax system on profits or free cash flow,” the anonymous source continued.
For his part, the producers feel good at the moment as to the direction of the talks.
“It seems government officials have listened to us carefully. If they heard us, it will be revealed in the near future. But the fact that the dialogue has finally taken place is certainly a positive development, ”Russian steel producer Severstal said in a related statement.
Sources said Reuters that Prime Minister Mikhail Mishustin would make the final decision after receiving the recommendation from the Ministry of Finance.