Distribution of mineral extraction revenue: overview of international practice

Abstract

Purpose. To study basic principles and conditions of the efficiency of the system to redistribute mineral extraction revenue including the countries with lower levels of welfare.Methods. The research applies a method of qualitative and quantitative analysis of the scientific literature, data by the Natural Resource Governance Institute, national reports according to the Extractive Industries Transparency Initiative, and open Internet sources. Taxation schemes for mineral extraction revenue as well as the most important tendencies in the schemes changes over the recent years were considered. Distributions of the resource taxes in terms of the state administration levels as well as vertical distribution of budget receipts from the development of natural resources were analyzed. The countries distributing tax receipts from the mineral extraction in favour of the local authorities were selected as the object of the research.Findings. It has been determined that in the majority of countries, payments from mineral extraction are sent to the national-level institutions being distributed back to the mining areas or neighbouring territories. It has been pointed out that certain countries send a share of the mining income to the local budgets automatically using the formulas based on the objective indicators such as amount of population, amount of budget receipts from the area, poverty rate or geographical position. It has been identified that the basic principle of the system of resource use taxation to provide social welfare is represented by the optimal taxation scheme stimulating the production and maximizing the income which share is redistributed in favour of the society to cover all the local administration levels.Originality. The comparative analysis and determination of the recent data of distribution of budget receipts from mineral resources in terms of the developing countries.Practical implications. The obtained results may favour the scientific substantiation of the strategy to distribute mineral extraction revenue, planning of the development of mineral and raw material complex of the Central Asian countries; moreover, they may be useful while assessing the efficiency of investment projects of the field development.

Studying the features of the implementation of underground coal gasification technology in terms of Lvivvuhillia SE

“…To balance the fire face advance, its active zones are reversed. In terms of reversing, the flexible metallic pipeline (7) advances along the well (3).…”

“…Development of the on-balance and off-balance reserves of the mines completing their life period or being closed down promotes the implementation of mobile, complex, and ecological technologies to mine those reserves [1][2][3][4]. Such technologies include underground coal gasification (UCG) In this context, the processes, based on the UCG technology, combine extraction of coal and its utilization for power and chemical production [5,6].…”

Energy Price Formation and Energy Consumption by Households as a Factor of Ensuring Energy Safety

“…Taxation schemes vary significantly in the context of national risk components (political, sovereign and legislative). Since the normal profitability of some investment projects on field development is higher in the country with high estimated risks, the taxation scheme should offer additional tax incentives or reduction to compensate for excess risks (Churin et al, 2019). The optimum ratio of tax instruments depends on the opportunities and preferences offered by a particular country.…”

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“…The created mechanisms regulate the ongoing process or eliminate the consequences of an already completed event. In a study by Churin et al, it was proved that operation of the system to redistribute mineral extraction revenue occurs upon completion of the technological revolution and is its consequence, but not vice versa (Churin et al, 2019). Yakushik draws attention to the necessity of dialogue and mutual understanding between different civilizational layers in national States and in inter-State relations (Yakushik, 2019).…”