The Polish government is still working on changes to hydrocarbon taxes, Treasury Minister Mikolaj Budzanowski said Monday as the prospect of increases in the duties on production from new oil and gas discoveries hits exploration efforts.
The minister cited Israel as an example of an interesting tax solution for a country dealing with new oil and gas discoveries. In 2011 the Middle Eastern nation steeply increased tax on oil and gas production to between 52% and 62% from 30% despite protests from energy companies.
"In Israel, where gas was discovered in 2009, the fiscal law wasn't changed until 2011, after the size of reserves was established," Mr. Budzanowski told a news conference.
Polish state news agency PAP Monday quoted Deputy Finance Minister Maciej Grabowski as saying the government wants to prepare the new oil and gas tax regulations by end of this year. The tax is planned to be enacted starting Jan 1, 2015.
People working in Poland's embryonic shale gas sector told Dow Jones Newswires in recent weeks that uncertainty about the shape of the hydrocarbon tax bill has prompted them to slow down drilling of test wells.
The investors see ongoing media reports, never clearly shot down by the government, about mooted tax rates, as well as concern in the industry that a special government entity will take a stake in each shale gas concession