The Russian state oil transportation company Transneft allowed the closure of its subsidiary Zapad-Transnefteprodukt due to the actions of Minsk, RIA Novosti writes with reference to the company’s president Nikolai Tokarev. The company decided to leave Belarus due to the high tax burden and administrative pressure.
Transneft has planned to conduct an economic audit of the Belarusian enterprise. Zapad-Transnefteprodukt is responsible for the supply of oil to Hungary and Latvia via the Druzhba pipeline. “We believe that the economic situation of our enterprise has been aggravated by hand, unfortunately, on the part of the authorities and departments of Belarus. (…) The enterprise is working in the red, and, of course, this situation cannot suit Transneft, ”Tokarev said. He added that the situation has not changed for a long time.
“Law enforcement officers, prosecutors, tax authorities, a lot of departments have joined the case, which do not come to help, but to supervise, check and do something else. Therefore, we, of course, will not look calmly at this. We will conduct a very careful economic audit, although everything is already clear to us, and the decision will be made from the perspective. In the near future, in two or three weeks, a large package of agreed bilateral documents will be signed, if after that the situation does not change, well then, until the suspension of the enterprise’s activities, the issue will have to be resolved. We would not want to yet, ”he said.
Since January 2020, the Belarusian authorities have tripled the tax rate on profits from the transit of Russian oil and oil products through the country – the figure has grown from 18 to 50 percent. The tax burden was increased despite the fact that each ton of fuel per 100 kilometers was already subject to an environmental tax of 0.35 rubles.
The management of Transneft then thought that excessive taxes could lead to bankruptcy and further nationalization of Zapad-Transnefteprodukt, which costs almost seven billion rubles. Belarus is interested in purchasing an oil pipeline to supply its oil refineries with raw materials from Europe and pump oil products in the direction of Ukraine.
In addition, in the winter the vice-president of the pipeline monopoly Maxim Grishanin announced the increase in administrative pressure on the company. Transneft claimed that by February 10, 2020, it had received more than 150 requests from Belarusian government agencies, while in 2019 their total number was 27. The number of on-site inspections also increased fivefold – to 20. “In such a situation, it is normal Zapad-Transnefteprodukt cannot function, ”Grishanin said.