Russia's Finance Minister Alexei Kudrin changes his opinion and will look at new cuts in oil sector levies as long as there are no cuts in other taxes.
The comments appeared to mark a turn-around for the staunch fiscal hawk who yesterday told Reuters he saw no scope for tax cuts and that if any energy producers were unhappy with this, there would be plenty of others willing to take over their patch. Instead he has proposed tax hikes to help shore up the pension system.
"If we don't cut value added tax and others, then we'll take another look at the oil taxes," Kudrin said at a meeting of Russia's main business lobby.
"It's possible. We will consider it. But I am not willing to give a timeframe."
His comments appear to chime with calls for a compromise on the issue from Kremlin economic aide Arkady Dvorkovich.
President Dmitry Medvedev is expected to make the final decision on tax reform later this month.
Oil companies pay a progressive tax on the oil they sell, limiting their upside from high prices. Suggestions of changes to the oil tax regime tend to drive swings in stock prices.
"With oil prices going down, the government may simply be unable to find room for further tax cuts in its 2010 budget plan," analysts at VTB Capital said in a research note.
"Should the government decide to freeze the tax reforms which had earlier been hinted at by the Ministry of Energy and oil majors, the oil sector could lose an important medium-term value trigger."
