ERBIL, Kurdistan Region (Kurdistan 24) - On Friday, authorities in Ankara granted the Russian government-owned energy firm Gazprom exemption from several tax requirements for its pipeline operations on the Turkish continental shelf as a sign of further cooperation between the two nations.
A bulletin on the official gazette by the Prime Ministry stated that Gazprom's TurkStream project would not have to pay the 18 percent-high value-added tax (VAT) for consulting, legal, accounting and engineering services on the Turkish soil and coast.
Apart from the VAT exemption, Gazprom would also enjoy not paying special consumption, income and corporation, revenue stamps, and real estate taxes.
Negotiations between Moscow and Ankara for the TurkStream project, which will transfer Russian natural gas to European markets through Turkey, have been underway since 2014.
Russia is Turkey’s largest gas supplier, with sales of 28-30 billion cubic meters annually worth around $6.5 billion, according to figures by Reuters Finance.
Presidents Vladimir Putin and Recep Tayyip Erdogan signed a deal worth billions of USD only two years after major ups and downs in their relations due to rival policies in war-torn Syria.
The pipeline extending under the Black Sea from Russia's southwestern federal region of Krasnodar Krai to west of Istanbul will be able to carry 31.5 billion cubic meters per year.
The construction of the approximately 1,000 km (680 mi) pipeline began last year.
The deal followed a reconciliation after an apology by Erdogan in mid-2016, half a year after the Turkish takedown of a Russian fighter jet that allegedly violated Turkey's bordering airspace with Syria.
It was also then when Turkey launched operation 'Euphrates Shield,' an incursion into a pocket of land in northern Syria to drive away the Islamic State (IS) group before the US-backed Kurdish People's Protection Units (YPG) could do so.
Russo-Turkish ties have seen significant improvement, including in military affairs in the past year despite concerns by Ankara's western allies.
In December 2017, Ankara finalized a 2.5 billion USD-worth agreement with Moscow to acquire Russian S-400 air missile defense systems that cannot be integrated with those of NATO.
The two countries, along with Iran, also co-sponsored peace talks at the Black Sea resort city of Sochi to establish a political solution in Syria where Moscow successfully helped the Damascus government regain control of much of the territory lost to Ankara-backed Islamist rebels.
Controlling the northwestern airspace of Syria, Russia gave the green light to Turkey for a much-threatened and now two weeks-long offensive aimed at invading the Kurdish enclave of Afrin.
Editing by Nadia Riva