No discussions of windfall tax for 2025 within Russian Finance Ministry, too early to count current additional revenues - deputy finance minister

SHYMKENT. March 27 (Interfax) - There are no discussions in the Finance Ministry about the possibility of additionally extracting corporate profits for the previous year, and it is premature to analyze current excess profits amid rising prices for certain export goods, Deputy Finance Minister Alexey Sazanov said.

Corporate profit tax returns for last year are being filed this week. "We need to look at the numbers. We are not discussing it [a windfall tax] yet," Sazanov told journalists in Shymkent.

Regarding additional revenues due to the surge in volatility on commodity markets caused by the Middle East conflict, according to Sazanov, it is too early to discuss them.

"It is generally unclear how to discuss this now. Whether it is a one-time phenomenon is unclear, how long it will last. We currently have no such discussions," he said.

The issue of extracting additional revenues in a number of sectors amid rising prices was raised on Thursday in the State Duma during the review of the Central Bank of Russia's report. One parliamentarian proposed extracting additional natural resource rent as a measure to maintain the budget's balance - for example, from oil companies.

Economic Development Minister Maxim Reshetnikov, commenting on this proposal, said that such an idea could be discussed, but it must be linked to the investment cycle of companies in these sectors.

"Several questions were raised regarding the taxation of resource rent. Obviously, you remember that the issue was on our agenda in 2022. The issue was about the windfall tax. We then adjusted taxation, primarily regarding the mineral extraction tax, made the mineral extraction tax progressive in practice and tied it to the growth in prices for raw materials," Reshetnikov said.

"We probably need to see how well this works and whether it was implemented in full everywhere. Because for a number of items, prices are now likely at levels that few assumed could even exist. This is a matter for separate analysis. We need to relate all this to the investment cycle in these sectors, so as not to jeopardize projects that have already been started. Therefore, we are ready for dialogue here," he said.

Subsequently, the head of the Russian Union of Industrialists and Entrepreneurs (RSPP), Alexander Shokhin, after a meeting between President Vladimir Putin and business representatives, said that the head of state expressed hope for a resolution of the Middle East crisis within the next 3-4 weeks. "Therefore, he did not strongly suggest that the Finance Ministry and companies count on a 'shower of gold' lasting too long," Shokhin said.

"There is no talk of any windfall tax, because currently, only a limited number of companies, due to favorable market conditions, have the opportunity to earn a little more," Shokhin said.

The last time the authorities resorted to a windfall tax was in 2023, collecting over 300 billion rubles. It did not affect companies in the oil and gas sector or coal miners; the main payers of the windfall tax were mining, metallurgy and trade.