CARACAS, Venezuela (AP) — Venezuela moved Tuesday to take a greater cut of windfall oil profits, approving a 50 percent tax on foreign oil companies when crude tops US$70 a barrel.
The tax rate would rise to 60 percent when the average monthly price for benchmark Brent crude exceeds US$100, according to the bill approved by Venezuela’s National Assembly. The legislation will take effect as soon as it is published in the official gazette.
Revenues from the tax could reach US$9 billion (euro5.7 billion) annually, Oil Minister Rafael Ramirez said after meeting with lawmakers.
“That’s why, for the executive branch, it is urgent to create this law,” Ramirez said.
The new legislation will let President Hugo Chavez further extend state control over foreign oil companies operating in Venezuela — home to the largest petroleum deposits in the Western Hemisphere — as he steers the nation toward what he calls “21st-century socialism.”
Thing about socialism? Failed in the 19th Century. Failed in the 20th. Not likely to succeed in the 21st.
(Hat tip: The Heritage Foundation blog, The Foundry.)
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