Director General of Taxes: Law No. 19 of 2010 systems the process of settling accounts with tax foreign oil companies

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Director General of Taxes: Law No. 19 of 2010 systems the process of settling accounts with tax foreign oil companies

12/30/2012 | (Voice of Iraq) - Add a comment -

Baghdad (news) Qais Mullah longer tax one important means used by governments for financial gain abundant contribute to support the state budget and make ends meet growing to achieve this financial tool of big savings to support economic activity, especially in developed countries. On Iraq took those financial instrument Take resonate in supplying the federal budget the state in recent years, particularly after the enactment of the imposition of income tax on foreign oil companies contracting for work in Iraq No. (19) for the year 2010 and instructed No. (5) for the year 2011. says Director General of Taxation Kazim Ali Abdullah In an interview with an expanded with the Agency (news): This law systems process settling accounts taxation with foreign oil companies that received contracts under licensing rounds, adding that this law raising the ceiling of tax of 15% on normal activity customary to 35% of corporate profits operating in the extractive industries sector excavation and exploration and industrialized. was the Presidency of the Republic of Iraq has approved in February 2010 law imposing income tax on foreign oil companies contracting for work in Iraq No. (19) for the year 2010 and that Article 1 of which income tax rate of 35 % on income earned in Iraq for contracts with foreign oil companies contracting for work in Iraq or its branches or offices and subcontractors with them in the field of production and extraction of oil and gas and related industries. came in the reasons that this law initiated for the purpose of supporting the national economy and the subordination of income in Iraq for foreign oil companies and contractors from subcontractors in the production and extraction of oil and gas to income tax. as newspaper published the facts of Iraq in its 4224 issued on 12/26/2011 Instructions No. 5 for the year 2011 to facilitate the implementation of the provisions of this law, which stated: The Income Tax stipulated in the law include (contracts to explore and develop and produce patches exploratory and oil and gas fields, seismic surveys, drilling, reclamation wells, technical operations associated with the wells and include landing bushings and Altzmat and revive the wells and palpation electrical and completing wells, surface facilities for the extraction and production of oil and industries related to them, installations water injection, pipeline flow, treatment plants gas, cathodic protection, engineering test and quality control related to the oil industries, drilling water, اضافةالى activities related extraction down to the extent that the oil or gas is ready to pump to export outlets). said Abdullah: that the return you get foreign oil companies winning contracts service within licensing rounds up to two dollars sometimes Audolar only one by the field in which they operate the company, and between that this revenue deducted from the partner's share of Iraq's 25%, as well as deducting tax rate of 35 %, while on the go remainder of this revenue gain for the oil companies of foreign result amounts introduced by investments in the development of Iraqi oil fields. terms of numbers if we assume that the rate of return you get oil company of foreign investment in Iraqi oil fields was two dollars per barrel are deducted 50 cents of this revenue represents the partner's share of Iraq, leaving $ 1.5 subject to income tax on foreign oil companies contracting for work in Iraq, amounting to 35% where it is deducting 52.5 cents, which means that the share of the Iraqi treasury of this revenue will be 102.5 cents, while the company will foreign on 97.5 cents only gain for every barrel of oil you باستخراجه. pointed Abdullah that the GCT is working with the Ministry of Oil for the exchange of information so do not pay the ministry share the foreign partner, but after deducting share the tax of 35%, and continued to share the Iraqi partner of 25 % are not subject to tax because the government does not penalize itself and Iraqi partner of course is a government company does not pay taxes to the source. and pointed out that the oil ministry was very smart when introduced these benefits within decades licensing rounds and she tied ceilings certain production should reached by companies, stressing that companies if they do not reach these levels will not deserve any return what will generate an incentive for those companies to expedite the process of extracting oil and exported for revenues and profits more according to share specified under the contract signed between them and the Ministry of Oil. increased Abdullah: that of the other advantages of these contracts are that the Iraqi side will not spend any amount on the project because all the investment expenditure would be borne by the foreign partner coming from beyond the borders, as well as that everything going foreign partner to Iraq of equipment and supplies oil industry pipes and towers drilling and thousands of other details which billions of dollars will become once inside the Iraqi border king of Iraq and not the foreign partner. With increasing Iraq's oil exports and add millions of barrels exported to the current rates experts expect accounting and economics that reflected those taxes significantly on the revenue the state treasury Iraqi allowing financial savings extra for the Iraqi economy, stressing at the same time the urgent need for a system accountable sophisticated tax to keep up with tax increases that will occur in the future with escalating production and Iraq's oil exports to at least 6 million barrels in the next five years according to the plan developed by the Iraqi Oil Ministry to raise the country's oil exports.

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