Petrobras urges approval of new Brazil oil tax deal

RIO DE JANEIRO, Oct 2 (Reuters) - Brazil's state oil company Petrobras on Tuesday called for the swift approval of a tax deal brokered by the industry after the Rio de Janeiro state abandoned a nation-wide treaty exempting imported oil equipment from tax.

The new proposed deal envisages a modest ICMS value-added state sales tax of 3 percent paid directly or 7.5 percent with future compensation via a credit. Analysts have said the industry should easily absorb the levy.

"Petrobras defends the approval in the next few days of the proposal agreed to by the Brazilian Petroleum Institute (IBP), the governments of Bahia and Rio de Janeiro states and Petrobras, seeking to maintain uniform rules in all states for imports of oil rigs," Petrobras (PETR4.SA: Quote, Profile, Research, Stock Buzz)(PBR.N: Quote, Profile, Research, Stock Buzz) said in a statement.

Rio, whose offshore fields account for nearly 80 percent of Brazil's crude output, had initially pressed for levies of up to 16 percent. The IBP, an influential oil industry group, had come up with a much lower counter-proposal and the agreed taxation is closer to the industry's proposal.

The Confaz finance and revenue policy council is yet to ratify the proposed deal.

The original tax exemption allowed oil companies based in the country to import components and equipment for use in oil exploration and production. Without the exemption, a tax of up to 19 percent would apply.

Petrobras said the new proposed legislation would tax only new rigs to be imported, based on their import value.

It said its new 180,000 barrels per day P-54 rig, which is due to start producing this month, has already been imported tax-free and there was a court decision banning its taxation.

Earlier on Tuesday, Petrobras exploration and production director, Guilherme Estrella, said the company would have to review some projects due to the tax. "I favour the idea of taxing oil production, but not if it makes projects inviable," he said.