Russian government discusses tax relief for Gazprom, source says

MOSCOW (Reuters) -Russia's government has been considering some tax relief for energy giant Gazprom, offset by potentially higher taxes on other gas producers, a government source said on Monday.

Novatek and Rosneft are also large gas producers in Russia.

Moscow has to balance the need to boost military spending amid the conflict in Ukraine with tackling a rising budget deficit and providing sufficient support to Gazprom, which saw its lucrative sales to Europe collapse.

Gazprom incurred losses of almost $7 billion in 2023, its first annual loss in more than 20 years, as much of Europe shunned its gas in protest over Russia's actions in Ukraine, and while the company earned $14.8 billion in 2024, it still paid no dividend.

The company is now focused on boosting gas exports to Asia, especially to China, as a part of Moscow's pivot to the East.

Interfax news agency first reported the government's possible plans to ease the tax burden on Gazprom, in line with President Vladimir Putin's order.

It said, citing unidentified sources, that if lower taxes for Gazprom were introduced, the budget may be compensated by "appropriating" some profit generated by other gas producers.

The source who spoke to Reuters confirmed there were such deliberations within the government, but there has been no decision yet. The government has already eased mineral extraction tax for Gazprom this year.

($1 = 78.5000 roubles)

(Reporting by Darya Korsunskaya. Writing by Vladimir Soldatkin. Editing by Guy Faulconbridge and Mark Potter)