Azerbaijan Determined Allocations on Profits Tax from AIOC in 2007

Oil&Gas Materials 25 December 2006 14:40 (UTC +04:00)

According to Bill On State Budget for 2007, 1.4 bln. AZN are expected to be allotted to the profits tax by the subcontractors of the Production Share and Joint Development Agreement on the Deepwater Sector of Block of Fields Azeri-Chiragh-Gunashli (ACG) in the next year.

As Trend was told in the Azerbaijan Finance Ministry, due to the advance in the oil prices this year, the allotments to the profits tax has exceeded all the expectations, and over the third quarters of the year, the State Budget received over 800 mln. AZN, though the expectations for 2006 was expected at the rate of 600 bln. AZN..

The calculations were made on the basis of the oil price put into the State Budget ($40). Then, due to the continuing tendency in the rise in the prices, the figure was extended to $50 per barrel of oil in the Budget from the middle of the year.

AIOC launched paying the profits tax only after all its expenditures had been paid. It was proposed that at sustaining the average oil price in the international markets at $40 per barrel, in 2006 AIOC would pay the remaining expenditures at $548,6 mln., as well as gain revenues from taxes to the sum of $880 mln.

Notably, AIOC pays the profits tax at the rate of 25%, which was stipulated in the contract.