MOSCOW – Russia is considering pegging a mineral extraction tax (MET) levied on its metals producers to the global price of their products from 2022, the Interfax news agency reported on Friday, citing Deputy Finance Minister Alexei Sazanov.
Moscow has been trying to protect its defence and construction industries from further growth in raw materials costs as metals prices rise at a global level.
It has already imposed new export taxes for steel, nickel, aluminium and copper, which will cost their producers $2.3-billion in August to December 2021.
"There is an idea that when there is a surge in prices caused by the commodity 'super cycle', some excess profit should be withdrawn. We are talking about tying the MET rate to the price of the product," Sazanov was quoted as saying by Interfax.
"The question is still being discussed, the government has not decided yet," Sazanov said, adding that the commodity super cycle, in his view, was unlikely to extend beyond 2022.
It would be the third tax increase for the Russian metals and mining industry since the start of the year, when the government raised the MET export tax for metals firms to boost proceeds for the pandemic-hit budget.