Gazprom faces potential tax hike amid rising wholesale gas prices

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Gazprom faces potential tax hike amid rising wholesale gas prices
Credit: © Reuters.

In a move to balance escalating wholesale gas prices, Russia's State Duma Committee on Taxes and Budget has tentatively approved amendments to raise the mineral extraction tax and index gas tax for Gazprom (MCX: GAZP ) PUBLIC JOINT-STOCK COMPANY. The proposed changes were put forth by the Ministry of Finance and are set to undergo further review, taking into account perspectives from Gazprom, other relevant companies, the Ministry of Energy, Deputy Prime Minister Alexander Novak, and independent producers.

The revised taxation structure aims to safeguard budgeted revenues through a recalibration of domestic gas price calculations and the introduction of a Gazprom-specific levy. Deputy Finance Minister Alexei Sazanov highlighted these measures during Tuesday's committee meeting.

However, concerns have been raised regarding potential losses as a result of additional tax burdens in the context of declining gas exports. Pavel Zavalny, head of the Duma Committee on Energy, voiced these apprehensions after discussing the amendment with Novak and independent producers.

The State Duma Committee on Taxes and Budget is scheduled to continue deliberations on these amendments in a meeting set for Wednesday. These discussions will consider feedback from Gazprom, other concerned companies, and the Ministry of Energy. The proposed alterations are seen as a response to growing wholesale gas prices and aim to protect income budgets for the domestic market.

InvestingPro Insights

In light of the recent tax amendments proposed for Gazprom, it's important to consider a few key metrics and tips from InvestingPro.

InvestingPro Data reveals Gazprom's Market Cap to be at 43191.17M USD, with an impressively low P/E Ratio of 3.32. The company also recorded a Gross Profit Margin of 76.02% for the last twelve months as of Q4 2022, a testament to its financial health.

InvestingPro Tips highlight the company's impressive gross profit margins and the fact that it's trading at a low earnings multiple. These factors, combined with the company's position as a prominent player in the Oil , Gas & Consumable Fuels industry, indicate its potential resilience in the face of the proposed tax changes.

For further insights, consider exploring the additional tips available on InvestingPro. There are 6 more tips related to Gazprom that can provide a deeper understanding of the company's financial standing and potential for growth.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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