Russia changes tax code to make it easier for foreign companies to pay in rubles

A man walks past a branch of Gazprombank in Moscow on March 31.MAXIM SHEMETOV/Reuters

Russian lawmakers passed an amendment to the tax code on Wednesday that they say would make it easier for foreign companies to open accounts with Russian banks and pay for Russian gas and other goods in rubles.

Russian President Vladimir Putin signed a decree last month requiring foreign buyers to pay for gas in rubles or risk having their supply cut off. He said this was necessary because if they paid in hard currency, Western sanctions against Ukraine would prevent Moscow from accessing the money.

In practice, the measure requires foreign gas buyers to open ruble and hard currency accounts at Gazprombank, which will receive their foreign currency payments and convert them into rubles via auction on a Moscow exchange.

Olga Anufrieva, deputy chair of the parliamentary budget committee, said the new amendment “greatly simplifies registration and opening an account” with a Russian bank.

Putin said the role of national currencies such as the ruble in export deals should increase, and Reuters reported on Wednesday that oil giant Rosneft had asked for rubles and full advance payments in crude tenders. .

Kremlin spokesman Dmitry Peskov said there was still time for so-called “unfriendly” countries to switch to the rouble, as payments for gas delivered since Putin’s decree will fall due in May.

Russia invaded Ukraine on February 24 in what it called a “special operation” to demilitarize and “denazify” its neighbor. Ukraine and Western nations dismissed this as a baseless pretext for war.

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