The excise tax on fuel will be reduced from the 1st of June

31 May 2018

Another decline could happen July 1

The growth of prices on fuels and expected reduction in excise duties are the most hot topics of recent weeks. About a week ago, the government announced unprecedented by Russian standards action: after the meeting of the State Duma Committee on energy, it was decided reduce excise duties on gasoline and diesel fuel — from 1 July to the end of the year. Now, however, it became known that the excise tax can reduce from the 1st of June.

In General, 1 July 2018 originally planned another increase in fuel surcharges. This situation has long been familiar: initially, the state tax on fuel was intended to replace the transport tax, although to the present moment motorists pay the excise taxes (on them in the final price of fuel accounts for up to 70 %), and Russia's transport tax.

However, amid skyrocketing prices of gasoline and diesel fuel, which began in the spring, the government decided to change strategy. The expected easing of the tax burden, although it will lead to the elimination of a small percentage of Federal revenues, they will be handsomely compensated by a gain markedly soaring oil prices.

Post plans to reduce excise duties to the Agency TASS said the meeting with Deputy Prime Minister Dmitry Kozak, who is responsible for energy issues. If you believe his words, now the excise tax on gasoline will be reduced by 3 000 rubles, and diesel fuel by 2 000 from 1 June. Moreover, from July 1, they can again decrease by 700 rubles.

However, experts believe that even such measures will not lead to lower retail prices. In the best case we can expect a slight stabilisation, especially when you consider that the Federal Antimonopoly service (FAS) issued a warning of "Rosneft" suspected of underreporting sales volumes of petroleum products that could cause rising fuel prices. Also FAS asked the Russian oil companies to increase production and the supply of fuel to the domestic market.