>>Slump in global oil prices triggers tax cut>>
FEB. 11 2015 (The Conway Bulletin) — Kazakhstan will slash its oil export duty by 25% to help companies manage a sharp drop in energy prices, economy minister Yerbolat Dossayev said.
The measure is part of a package of proposals designed to help Kazakhstan’s economy weather an increasingly nasty economic downturn. Energy minister Vladimir Shkolnik also said that taxes on miners would be cut soon.
Currently oil exporters pay $80 to ship a tonne of oil out of Kazakhstan. The government will cut this to $60.
It’s a drastic step for Kazakhstan which still relies heavily on oil exports for its revenue. Drastic but, possibly, unavoidable. Oil prices have halved in the past seven months, forcing spending cut backs and budget cuts.
The sharp drop in oil prices also creates another problem for Kazakhstan. It makes the more expensive projects, such as the Kashagan project in the Caspian Sea, unprofitable. Dropping export tax may go some way to addressing this problem.
ENDS
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(News report from Issue No. 219, published on Feb. 18 2015)
