Ukraine's Government Seeks Increase in Transit Fees for Russian Oil

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http://ap.tbo.com/ap/breaking/MGBP7TY0S2E.html

KIEV, Ukraine (AP) - Ukraine proposed raising transit fees on Russian oil Wednesday, as the cash-strapped government looks to avoid increasing taxes and sparking a public backlash ahead of the country's presidential vote.
The government of caretaker Prime Minister Mykola Azarov proposed raising fees by 30 percent, to 89 cents per ton, a move sure to infuriate the Kremlin.

All but one of Russia's major oil export pipelines to Europe pass through Ukraine, and Russia's interest in Ukraine's disputed elections - Russian President Vladimir Putin twice visited Kiev this fall - is seen as partly motivated by a desire to keep transit fees low.

The Ukrainian government is desperate for cash after business slowed during political chaos following the Nov. 21 runoff vote, which the Supreme Court ruled was marred by fraud and should be repeated on Dec. 26.

During the so-called Orange Revolution, in which thousands of supporters of opposition presidential candidate Viktor Yushchenko poured into Kiev's streets, the government said it lost an estimated $216 million in taxes and customs fees. The Kremlin had backed Yushchenko's opponent.

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