Putin calls for fair nickel, copper duty formula
NORILSK. Aug 31 (Interfax) - Russian Prime Minister Vladimir Putin called for a fair formula to be developed for calculating export duty on nickel and copper, one that takes world price volatility into account.
Putin said at a conference in Norilsk that the government helped MMC Norilsk Nickel , the world's biggest nickel producer, by scrapping export duty on nickel and copper when the crisis was at its height. But now, when the situation has stabilized and world prices are fairly high, and able to keep Norilsk Nickel in profit, the issue of duties is back on the agenda, Putin said.
"Let's discuss this more carefully. An initiative has been made to work out a flexible formula, where the fiscal burden would vary as world nickel prices rise or fall. But this formula has to be fair and take world price fluctuations into account," Putin said.
"If this formula is not elaborated, then I'll have to side with my colleagues, who are putting their own solutions on the table, and this might not be to the liking" of Norilsk Nickel's management, Putin said.
The Russian government's sub-commission for customs-tariff policy could review nickel and copper export duties in the last week of September, a source at the commission told Interfax in Friday.
First Deputy Prime Minister Viktor Zubkov, during a meeting of the sub-commission on Friday, urged the body to speed its approval of the duties up, the government says on its website.
The Russian Economic Development Ministry has suggested introducing an export duty on copper and adjusting the existing 5%-duty on nickel, which could become a progressive duty, pegged to metals prices on the commodity exchanges.
A Finance Ministry official has said a nickel export duty scale might come into effect in 2011 and that the nickel duty might be up to 30% of the difference between the actual price of nickel and a benchmark price of $20,000 per tonne. A 10%-duty on copper might be introduced in 2011.
The Finance Ministry estimates a progressive nickel duty might generate an additional 14.4 billion rubles in budget revenue in 2011, 14.3 billion rubles in 2012 and 12.8 billion rubles in 2013.