Venezuela passes 'windfall' oil tax

Parliament approves additional taxes for sharing profits from record oil prices.

    Hugo Chavez, the Venezuelan president, has nationalised part of the country's oil fields [Reuters]

    "Because of high oil prices, oil companies have excessive earnings that go beyond reasonable levels of profitability," Angel Rodriguez, a Venezuelan parliamentarian, told ABN, the country's state news agency.
     
    "One way to distribute them to our people, who are the owners of the oil, is to create this tax."
     
    The tax will apply to both international and national companies, including PDVSA, Venezuela's state oil company.
     
    Exxon battle
     
    Thursday's move will give Chavez new funds to shore up popularity among the nation's poor majority, who have backed him for almost a decade but are increasingly critical of his government for food shortages and rampant crime.
     
    Lawmakers could give the bill final approval next week.
     
    PDVSA took control of part of Venezuela's oil field last year as part of the nationalisation programme, pushing out ExxonMobil and the Conoco oil giants in the process.
     
    The showdown led Exxon to seek court injunctions for up to $12 billion in compensation, a move Chavez described as "legal terrorism" and threatened to retaliate by halting oil sales to the US.
     
    A London court last month threw out one of the orders.

    SOURCE: Agencies


    YOU MIGHT ALSO LIKE

    'We scoured for days without sleeping, just clothes on our backs'

    'We scoured for days without sleeping, just clothes on our backs'

    The Philippines’ Typhoon Haiyan was the strongest storm ever to make landfall. Five years on, we revisit this story.

    How Moscow lost Riyadh in 1938

    How Moscow lost Riyadh in 1938

    Russian-Saudi relations could be very different today, if Stalin hadn't killed the Soviet ambassador to Saudi Arabia.

    Daughters of al-Shabab

    Daughters of al-Shabab

    What draws Kenyan women to join al-Shabab and what challenges are they facing when they return to their communities?