Document shows that Russian oil and gas revenues will decline in 2025-2027 due to a reduction in tax burden for Gazprom.

A draft budget released on Monday shows that Russia's oil and gas revenues are expected to decrease in 2025-2027, due mainly to the easing of the tax burden for the country's biggest gas producer Gazprom.

The budget document states that the total budget revenue expected from oil and natural gas sales will decline from this year's 11.3 trillion Russian roubles to 10.9 trillion (117.53 billion) roubles in 2025, or 5.1% of GDP.

The revenue is expected to drop further, to 10,56 trillion roubles by 2026, and to 9,77 trillion roubles by 2027.

The Russian parliament will debate the draft budget.

The Finance Minister Anton Siluanov stated on Monday that revenues from the oil and natural gas sector would account for 27% in total proceeds to the state budget next year. The sector currently contributes around a third to the annual state revenue.

Since the invasion in Ukraine, state-owned Gazprom has seen its exports of pipelines to Europe, its former largest market, plummet. Miller is a longtime ally of Russian president Vladimir Putin.

Gazprom suffered its first net loss in 2023. The government still imposed an additional gas production tax of 50 billion Russian roubles per month on the producer in 2022. This will last from 2023-2025.

Documents revealed that the government plans to reduce this tax burden for Gazprom.

According to the document, the mineral extraction tax (MET), mainly on Gazprom's gas production, will fall by over 30% next year to just under 1 trillion roubles (10.76 billion dollars).

The document states that the MET on the gas production will be reduced from 2024 to 2025 by 550 billion Russian roubles via changes to Tax Code.

(source: Reuters)