Export of coal will be free of duty – Business – Kommersant
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Export duties on coal, which were planned to be introduced early next year, are being postponed for the time being. The Ministry of Finance intends to monitor the situation on the markets in the first quarter and then make a decision. Officials in the past two months have spoken of a low chance of raising funds from the coal duty as coal prices have slipped below the cut-off prices included in the duty formula. However, now in some areas the cost of coal exceeds these prices.
The government has abandoned the idea of introducing export duties on thermal and coking coal from the beginning of 2023, but will continue to monitor market conditions in the first quarter of the year, reports Interfax with reference to Deputy Finance Minister Alexei Sazanov. “We decided that the MET is enough,” the news agency quotes him as saying.
It was assumed that the duty would be levied if the FOB price exceeded $150 per ton of thermal coal and $170 per ton of coking coal. The duty rate in all cases was assumed to be 40%. In addition, export duties on fertilizers are also planned. In 2023, according to the draft budget, the government planned to receive a total of 135.6 billion rubles from these duties.
However, First Deputy Prime Minister Andrei Belousov said that “we are unlikely to collect anything from export duties from the coal industry next year.” However, the current situation and price forecasts suggest otherwise. In October of this year, the FOB East Coast thermal coal price was $181 per tonne. In the first quarter of 2023, the price of coking coal on an FOB basis for deliveries from the Kemerovo region to China and India through the port of Nakhodka will be $194 and $190, respectively, the Energy Ministry predicted.
Despite the waiver of duties, coal companies cannot avoid an increase in the tax burden. From January 1 to March 31, 2023, the MET rates for anthracite, coking coal and thermal coal will increase. This will attract 14.4 billion rubles to the budget.
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