On Wednesday the government of Slovakia approved a proposal by the finance ministry for a tax on Russian oil and crude products that are processed in the country, Reuters reports.
This tax will help to raise the budget revenue and decrease the country’s inflation rates. It was proposed by Finance Minister Igor Matovic on Tuesday and while he expected majority support, it earned some criticism from a government coalition partner. Economy Minister Richard Sulik has threatened to veto the plan but the proposal will now move to parliament for a vote. Sulik has opposed higher taxes in the past as a member of the Freedom and Solidarity party and argued that with the tax on Russian oil, fuel prices could increase.
If the tax is approved, it could raise up to 300 million euros and help the government reduce the pressure of increasing inflation for the people of Slovakia. Matovic said that the 30% tax should be paid from the amount between the price of products from other sellers and that of Russia.
Earlier this year, the Slovak government had considered a tax on “excess profits” for nuclear power production when households began to experience surging energy bills. Instead of imposing a tax, the government made a deal with the operator of the only two nuclear plants in the country. With Slovenske Elektrarne, owned primarily by Enel and a Czech billionaires EPH group, Slovakia capped household electricity prices.
The European Union is looking to introduce an embargo on Russian oil because of its war on Ukraine. Slovakia has asked for a temporary exemption from the ban because of its reliance on Russian oil. The Druzhba, meaning friendship, the pipeline was created during the Soviet Union era and brings Russian crude into Slovakia. The country’s only refinery is controlled by Slovnaft, operated by the Hungarian company MOL.
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