Rada Allocates Naftogaz UAH 32.2 Billion For Paying Ukrnafta's Tax Debt

The parliament has allocated the Naftogaz of Ukraine national energy company UAH 32.2 billion for paying the tax debt of the Ukrnafta company, the largest oil producer in Ukraine.

The second reading of the relevant draft law (No. 4119) was adopted with 283 votes, the Ukrainian News Agency reports.

According to the draft law, the government will pay Naftogaz of Ukraine UAH 32.2 billion as compensation for the company’s losses as a result of fulfillment of its public service obligation (PSO) to supply gas. An income tax of UAH 5.95 billion will be levied on these funds.

Naftogaz of Ukraine will pay Ukrnafta for disputed volumes of gas (2.06 billion cubic meters) and future gas production.

Ukrnafta will pay a tax debt of UAH 30.35 billion, as well as UAH 6.2 billion in VAT and income tax arising from the purchase (supply) of natural gas from Naftogaz of Ukraine.

Thus, the state will receive UAH 42.5 billion (UAH 36.55 billion in debt and new tax payments from Ukrnafta and UAH 5.95 billion in tax payments from Naftogaz of Ukraine).

Out of the surplus revenues of UAH 10.3 billion, UAH 1.4 billion will be used to pay salaries to miners and UAH 8.9 billion will be paid into the COVID-19 Fund.

As Ukrainian News Agency earlier reported, Ukrnafta plans to resolve the issue of payment of its tax debt of UAH 30 billion by the end of 2020.

Naftogaz of Ukraine’s Board Chairman Andrii Kobolev has expressed the hope that Ukrnafta’s assets will be divided after adoption of draft laws on settlement of the company's tax debt.

Earlier, Kobolev expressed the hope that Ukrnafta’s assets would be divided by 2021.

As Ukrainian News Agency earlier reported, the Naftogaz of Ukraine national energy company owns a 50% stake plus one share in Ukrnafta, Littop Enterprises Limited owns 13.6%, Bridgemont Ventures Limited 13.6%, Bordo Management Limited 12.9%, and other shareholders 9.9%.