MOL will have to pay a new 2.8% tax on its 2022 net revenues, according to a decree posted overnight, as special powers attained by Prime Minister Viktor Orban's government by declaring a state of emergency due to the war in Ukraine allow the government to impose measures by decree, with no need for the legislation to go through parliament. At the same time, the tax base of the Brent-Ural spread, on which MOL pays a 95% tax now, has to be reduced by $7.5 per barrel, the new decree said.
This latter windfall tax, which the government imposed on MOL last year, has siphoned off nearly all profits earned by MOL on cheaper oil imported from Russia.
The tax was part of a raft of special taxes that Orban's government launched on banks, drug makers, insurers and airlines in 2022 as it tried to rein in a huge budget deficit. Orban needs to rein in the deficit further this year and avoid recession, with annual inflation running at 25.4%. The decree also modifies the mining tax on MOL. MOL had net revenues of 9.868 trillion forints ($28.12 billion) in 2022 based on the fourth-quarter earnings report. ($1 = 350.8800 forints) (Reporting by Krisztina Than; Editing by Robert Birsel)
