It has been announced this week that the Russian Duma has approved a tax cut which is expected to lead to higher oil production.
The move, which will reduce the tax on mineral extraction for oil, is set to increase the annual earnings of oil firms by up to RUB5bn annually, according to a Reuters report.
Forbes quoted Russian Energy Minister Sergei Shmatko as announcing that:
"We anticipate that extraction volumes will be maintained and even increase thanks to the measures. We expect the money to be spent on the development of new deposits."
In addition to the proposal to cut taxes, it has also emerged that new tax breaks are planned for companies developing new fields in remote regions, lacking in the necessary infrastructure.
Under the proposal, companies in such regions would be permitted to pay reduced taxes for a 15 year period, or until a designated amount of crude oil has been obtained from the oil field in question.
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