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  • Venezuela ensures no more foreign investment

    CARACAS (Reuters) – New Venezuelan taxes on windfall oil revenue will let socialist President Hugo Chavez boost spending on popular social programs by billions of dollars ahead of his re-election bid next year.

    They set a top rate of 95 percent on some oil income and are Chavez's latest move to increase the state's share of the OPEC member's main export. During 12 years in power he has nationalized most of the South American nation's oil industry.

    His government predicted on Tuesday the new tax rates will bring in between $9 billion and $16 billion this year if oil prices keep rallying. Chavez has earmarked the money for a social spending fund and is already splashing it around.

    "This is justice," he said as he unveiled pay rises of up to 66 percent for public sector workers. "It will create consciousness and look after the country's wealth more."

    The tax hike was the latest example of resource nationalism by the leftist leader who is increasingly confident of winning another six-year term at a ballot due in December 2012.

    Brightening economic prospects have boosted Chavez's popularity after a hard couple of years, and the conflict in Libya has given him a chance to flex his oratory muscles as Latin America's leading critic of U.S. foreign policy.

    But more than anything, oil prices well over $100 a barrel are bringing money into Venezuela ahead of the election campaign -- and Chavez has decided to increase his government's take.

    "What defines our government's political position is who captures the oil revenue and how is it used," Oil Minister Rafael Ramirez told reporters at the headquarters of state oil company PDVSA -- the financial engine of his revolution.

    "The oil revenue should be captured by the Venezuelan state as the representative of the collective interest ... and distributed in a revolutionary way for our people's benefit."

    Chavez announced the top tax of 95 percent last week on "exorbitant" income when crude goes above $100 a barrel.

    A further rate will take 20 percent from oil income between $40 and $70 per barrel.

    COMPANIES UNDER PRESSURE

    Analysts cautioned the moves could have a chilling effect on foreign investment and limit the ability of PDVSA to fund more production.

    "Chavez's main motivation is likely to have more direct and arbitrary control over oil revenue ahead of the 2012 presidential elections," said Daniel Kerner of Eurasia Group.

    Chavez plans to launch a new government housing project at the weekend and this week revealed big increases to minimum wages and pensions.

    Ramirez told Reuters the new tax rates would not apply to planned new output from existing fields, or to projects to tap the country's vast Orinoco extra heavy crude belt, until the joint ventures had recouped their investments.

    All this comes at a time when Venezuela is putting pressure on companies including Chevron, Repsol, BP and Shell to boost production at joint venture projects in South America's biggest crude exporter.

    Chevron and Repsol are among a number of companies, including companies from Russia and China, involved in plans to develop the Orinoco belt, one of the biggest mostly untapped hydrocarbon reserves left in the world.

    http://news.yahoo.com/s/nm/20110426/..._venezuela_oil
    Facts do not cease to exist because they are ignored. -- Aldous Huxley
    Two things are infinite: the universe and human stupidity. -- Albert Einstein

  • #2
    Did I read this correct? There is a 95 percent tax on the oil in Venezuela? ie; They pump out 100 dollars worth and the government takes 95 dollars?
    This show is awesome, wrapped in supercool and smothered in bitchin. The only way it could be cooler is if he was riding a unicorn or something.

    M-11

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    • #3
      Originally posted by -Erik- View Post
      Did I read this correct? There is a 95 percent tax on the oil in Venezuela? ie; They pump out 100 dollars worth and the government takes 95 dollars?
      I think that is only on the amount by which the price exceeds $100 per barrel.

      Ten08 and pfchell must be drooling.

      If I ran one of the oil companies, I would sell the oil for $20 per bbl just so Venezuela would not get any revenue.
      Facts do not cease to exist because they are ignored. -- Aldous Huxley
      Two things are infinite: the universe and human stupidity. -- Albert Einstein

      Comment


      • #4
        Originally posted by DAL View Post
        I think that is only on the amount by which the price exceeds $100 per barrel.

        Ten08 and pfchell must be drooling.

        If I ran one of the oil companies, I would sell the oil for $20 per bbl just so Venezuela would not get any revenue.
        Wouldn't it make more sense to drill the oil yourself so you get 100 percent of the profits? If his line of thinking to get the government as much money as possible then why not cut out the middle man.
        This show is awesome, wrapped in supercool and smothered in bitchin. The only way it could be cooler is if he was riding a unicorn or something.

        M-11

        Comment


        • #5
          Originally posted by -Erik- View Post
          Wouldn't it make more sense to drill the oil yourself so you get 100 percent of the profits? If his line of thinking to get the government as much money as possible then why not cut out the middle man.
          The foreign companies are already drilling the oil.

          And PDVSA, being controlled by the government, is utterly incompetent. Its output has been declining.
          Facts do not cease to exist because they are ignored. -- Aldous Huxley
          Two things are infinite: the universe and human stupidity. -- Albert Einstein

          Comment


          • #6
            How nice, take away from the rich and middle class and give it to poor people just before elections...Chavez has destroyed a once beautiful country...
            sigpic

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            • #7
              Originally posted by Southflaguy View Post
              How nice, take away from the rich and middle class and give it to poor people just before elections...Chavez has destroyed a once beautiful country...
              That is pretty much what several forum members advocate: the Robin Hood approach to government.

              If the US had operated that way from its inception, we would all be poor, because no one would have generated wealth.
              Facts do not cease to exist because they are ignored. -- Aldous Huxley
              Two things are infinite: the universe and human stupidity. -- Albert Einstein

              Comment


              • #8
                Originally posted by DAL View Post
                That is pretty much what several forum members advocate: the Robin Hood approach to government.

                If the US had operated that way from its inception, we would all be poor, because no one would have generated wealth.
                Why bother working and earning money or starting a business?...When at the end of the day they're going to take it away...People become lazy and not motivated to do anything...I wonder why those who feel like Chavez is such a good leader don't come to Miami and rant and rave about him, Miami does have one of the biggest Venezuelan community in the US...I'm trying to think the last time Micheal Moore or Sean Penn were down here...

                I just wish those who think that communism is such a good system would live in a communist country for 10 years, they'll be running back to the States in no time!...
                Last edited by Southflaguy; 04-29-2011, 02:44 PM.
                sigpic

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                • #9
                  The Venezuelans in Miami are the ones who were productive and successful.
                  Facts do not cease to exist because they are ignored. -- Aldous Huxley
                  Two things are infinite: the universe and human stupidity. -- Albert Einstein

                  Comment


                  • #10
                    Originally posted by DAL View Post
                    The Venezuelans in Miami are the ones who were productive and successful.
                    Venezuela is one of those countries people from Latin America would move too...Not anymore though...People in Miami would invest and open a lot of business over there...My parents have good things to say about Venezuela, the pre-Chavez Venezuela...
                    sigpic

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                    • #11
                      I just wish those who think that communism is such a good system would live in a communist country for 10 years, they'll be running back to the States in no time!...
                      You don't want to get my Dad started on communism, that's why he and my mom left Yugoslavia back in the 70's to come here and start a new life.
                      Life is what you make of it

                      Comment


                      • #12
                        Originally posted by MD11pilot View Post
                        You don't want to get my Dad started on communism, that's why he and my mom left Yugoslavia back in the 70's to come here and start a new life.
                        People take America for granted...
                        sigpic

                        Comment

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