Taxes in Russia
Out of all BRICS countries, Russia has probably the most liberal tax system:
- Lowest corporate income tax at 20% out of all BRICS countries
- Lowest in Europe personal income tax at flat 13%
- One-time write-off opportunity for 30% depreciation costs
- Zero-rated profit tax for healthcare and educational establishments
- No capital gain tax for long-term direct investments
Taxes and levies are imposed on the federal, regional, and local levels.
Major corporate taxes:
|
Tax |
Taxable Base |
Tax Rate |
|
Profits tax |
Income minus expenses |
Max 20% - base rate reducible by regional authorities |
|
Value-Added Tax (VAT)
|
Sales of goods and services |
Max 20% - base rate with a lower rate of 10% for certain basic foods, children's clothing, medicines, printed publications, etc.) |
|
Excise tax |
Production and import of cars, tobacco, alcohol, petrol and lubricants |
Variable |
|
Customs duty |
Goods crossing the Russian customs border |
0% – 20% as per the Tariff Code for goods imported and the Country of Origin. |
|
Property tax |
Book value of fixed assets as per taxpayer's balance sheet. |
Max 2.2% reducible by regional authorities |
|
Transport tax |
Engine power, tonnage, type of vehicle per engine power (hp). |
Fixed rates per vehicle type. Rates vary to each vehicle type. |
Simplified taxation system
The simplified tax system replaces profits tax, VAT (except for VAT payable on imports), and property tax.
A company can apply for the simplified tax status if its annual revenue does not exceed RUB 150,000,000 (appr. €2M+ / $2.3M) and average number of staff does not exceed 100.
The simplified tax rate can be:
- 6% on revenues. Regional authorities can reduce it down to 1%; or
- 15% on profits (revenues minus expenses). Regional authorities can reduce 15% rate down to 5%.
Tax incentives
The following tax incentives exist in Russia:
- Regional incentives granted by regional or local authorities with respect to taxes paid to their budgets;
- Special tax regimes in Special Economic Zones (SEZs);
- Incentives related to certain activities (e.g. activities related to R&D, information technology);
- Incentives related to particular projects (e.g. Skolkovo Innovation Centre, the Sochi Olympics).