Russian parliament gives preliminary approval to one-off windfall tax

MOSCOW (Reuters) - Russian lawmakers on Wednesday gave preliminary approval for the government to levy a one-off windfall tax on big business, aimed at raising 300 billion roubles ($3.49 billion) to help finance Moscow's wide budget deficit.

Russia announced the plans as a gaping hole appeared in Russia's finances at the start of this year. Tax rises are one of the options Moscow has in keeping its budget deficit in check. The deficit stood at 3.41 trillion roubles for the first five months of the year.

A draft law was approved on Wednesday in a first reading by the State Duma, Russia's lower house of parliament.

"I think that tax increases are a bad thing but let's be honest - it's not by choice," said Andrei Makarov, head of the Duma's budget committee, when introducing the bill.

Companies with profits of more than 1 billion roubles over the previous two years would face a 10% tax on the difference in profits in 2021-2022 over 2018-2019.

Small- and medium-sized enterprises, oil, gas and coal firms and some other sectors are excluded. The finance ministry said those companies that paid before the end of November would have their the tax reduced by half.

In an interview with the RIA news agency published on Wednesday, Deputy Finance Minister Alexei Sazanov said such taxes could be repeated should the need arise.

"If in the future a hypothetical situation arises when companies have opportunistic excess profits and there is a need to finance a large deficit, then of course, such a possibility can not be ruled out," Sazanov was quoted as saying.

"But this depends on how the situation develops in the future."

($1 = 85.9955 roubles)

(Reporting by Darya Korsunskaya; Writing by Alexander Marrow; Editing by Cynthia Osterman)