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Agency fires new salvo in cash row


Venezuela slaps tax fines on trio



By Upstream staff 

Venezuela's tax office is set to fine Anglo-Dutch supermajor Shell, US player Harvest Vinccler and Italy's Eni over unpaid taxes from their operating agreements with state oil player PDVSA, local media has reported.

The trio are are the first three companies to be fined by the tax agency, Seniat, as part of an ongoing investigation into alleged tax evasion by 22 companies involved in 32 operating agreements with PDVSA, Caracas-based newspaper El Universal reported.

Seniat has claimed the 22 companies owe up to $2 billion in unpaid taxes dating back to 2000.

El Universal said that if producers make voluntary adjustments to their accounting procedures, then the fine will be 1% of the amount owed, plus interest. However, if they wait to be audited by Seniat, the fine could be up to 10% of the amount owed.

This means that Shell, Harvest Vinccler and Eni will likely face fines of 10% in addition to the amount owed, the paper quoted Seniat special contributions manager Jose Cedillo as saying.

About 18 companies have indicated that they will adjust their accounting procedures and six have said they will wait to be audited, Seniat said.

Seniat said that, in line with new Venezuelan regulations, companies must pay 50% tax on hydrocarbons production in every fiscal period.

Venezuela's tax code gives companies up to 36 months to pay fines imposed by Seniat, Cedillo added.

The tax investigation is part of PDVSA and the Energy & Oil Ministry's decision to alter the 32 existing operating agreements to create new joint ventures, in which PDVSA will hold a minimum 51% stake.

PDVSA president, the country's Oil Minister Rafael Ramirez has said the terms of the operating agreements signed under previous administrations were too generous to private companies and have resulted in losses to PDVSA.


Thursday, 02 June, 2005, 14:35 GMT  | last updated: Thursday, 02 June, 2005, 14:42 GMT

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