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Kyrgyzstan Review, 10 years ago




[19.02.23] Government to Lower Excise Duty on Oil Products in April

In April, Government of the Kyrgyz Republic will set excise duty on fuel and lubricating materials twice as low as it is now. This will be on of the measures to prevent smuggling in of oil products, reported T. Sarpashev, deputy of the LAJK, Head of commission on energy sector.
 
According to the deputy, there are about 300 mln tons of oil resources in the country At the present time, the cost of extracting a ton is 70-75 dollars, twice as high as on average in the world market.
 
The republic needs about 1 mln tons of crude oil per year. Overall, every year the country consumes about 130.8 mln dollars of oil products.
 
About 85% of all oil products imported in the republic are smuggled in. For instance, only 1.5 thousand tons of fuel and lubricating materials have been officially imported in the south last year, while 85% of all oil products consumed in the country are imported externally.
 
There is no point to set administrative barriers against contraband, economic barriers will be far more effective, points out T. Sarpashev.
 
Besides, 20% VAT on agricultural products will reduce the amount of smuggled in fuel and lubricating materials as well. It will be more profitable for the agricultural producers to buy oil products legally.
 
Furthermore, T. Sarpashev noted that already this year Kyrgyzstan will start extracting more oil and will aim for 150 thousand tons a year (as a result of the treaty between a private Chinese company and Kyrgyzneftgas.
 

NA AKIpress, February 19, 2003


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