Venezuela To Introduce New Tax On Oil Profits to Solve Ecological Problems

Venezuela is likely to introduce a new tax on windfall profits from oil production to help pay for environmental damage and to fund social programs, Oil Minister Rafael Ramirez said on Tuesday.

“We believe that the oil has to be used for the people in our country,” the minister said.

According to Ramirez, the foreign oil companies have done a lot of damage.

The minister did not say how much he expected the new levy to raise in the country.

“For that reason we are thinking of having new taxation for the extraordinary income,” he said. Ramirez said Venezuela was a poor country with a lot of problems, that needed funds for social programs, education and health.

Venezuela has been in a dispute Exxon Mobil over the country’s nationalization of a multibillion-dollar project in the Orinoco belt last year. Exxon Mobil won court rulings freezing some $12 billion in Venezuelan overseas oil assets in a move to secure compensation for the nationalized project. Venezuela responded by suspending sales to the top US oil company. Ramirez said all of the Venezuelan oil that was destined to be refined at Chalmette was being redirected. “We (decided) to send it to the Chinese market,” he said.