Russia and Belarus agree on oil export duties.

By bne IntelliNews November 12, 2010
Russia and Belarus reached an agreement on oil and oil products export duty as a part of negotiations on establishing a Unified Economic Zone that is planned to follow recent creation of Customs Union between Russia, Belarus and Kazakhstan. To remind, Belarus insisted that all the exports duties should be abolished within the new tri-lateral economic area, while Russia insists on keeping the export tariffs for energy sources. Previously, Belarus received 6.3mn tons of tariff-free Russian oil annually, which allows the country to save about USD 1.6bn, but the rest of the oil supplied to Belarus (about 15mn tons annually) is taxed at a normal rate. As now announced by the customs and tariffs policy department of FinMin, while Russia is going to abandon duties on oil and oil products to Belarus, Belarus agreed to transfer the revenues from its duties on oil and oil products exports to Russian budget. The mechanism for realizing such an agreement is now being designed, FinMin added. It is estimated that this is going to cost Belarus about USD 2.65bn annually, but profits on re-exporting Russian oil and refined oil products should exceed the loss on duties transferred to Russia. As reported, previously Belorussian EconMin representatives announced that the conditions of natural gas supplies pricing are also expected to improve, without being specific. Currently Belarus receives Russia gas at a 10% discount and is exempt of the 30% export duty.

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