Russia is considering longer-term measures to capture the majority of mining companies' profits after the temporary export tax ends at the end of this year.
Last month, the government announced tariffs of at least 15% on exports of steel, nickel, aluminum and copper from August 1 - at varying rates - to help reduce rising raw material prices and boost government coffers. He said the move would be temporary and would focus on developing more sustainable measures.
Officials are currently mulling changes to mineral extraction taxes, the rates of which are likely to be tied to commodity prices, so that fees go up when it happens in the market, people familiar with the matter said, asking anonymously as the information is not publicly available. This will likely replace export duties from 2022 when the final decision is made following parliamentary elections in September. According to them, other options for making a profit from mining can still be discussed.
Countries around the world have taken steps to reduce inflation in commodities and other key commodities as economies pave the way out of the Covid-19 pandemic. However, the interim measures that Russia announced in June could impact exports if companies hoard metal and shift costs to consumers. The increase in mineral extraction taxes likely means that producers are incurring most of the new costs.
“Regulation of the market through a mineral extraction tax will be less painful for the metals industry and the global market as it can be more predictable,” said Kirill Chuiko, analyst at BCS Global Markets. "The export duty was unexpected and affected markets such as aluminum, where price premiums have increased."
The Russian Ministry of Finance did not immediately respond to a request for comment. The main producers are PJSC Polyus, PJSC MMC Norilsk Nickel and United Co. Rusal International declined to comment.
What will happen after the abolition of the export duty in Russia
![Что будет после отмены экспортной пошлины в России](img/2021/07/250/azovpromstal1626171220.jpg)
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Azovpromstal® 13 July 2021 г. 13:09 |