Initiators of introduction in Russia of new taxes must be mindful of the decision of the President of Russia Vladimir Putin, declared in 2014 a four-year moratorium on the increase of the tax burden, said the press Secretary of the head of state, Dmitry Peskov.
“You yourself correctly stated the President’s position [on the nepovyshenie tax burden in the Russian Federation. -] until 2018, including about which he spoke in his message and further to various meetings,” – said Peskov, commenting on the possibility of introducing a sales tax (quoted by “Interfax”).
Previously on 21 March, the newspaper “Vedomosti”, citing its sources said that in the economic block of the government discussed the idea of returning to the number existing in the Russian tax sales tax (EPT). One of interlocutors of the edition explained that NSP existed in 1998-2004, he could be back in a trade collection that will not allocate it in check and not increase the price of goods in the amount of the tax. The estimated size of the collection may be 2-3%.
“In those discussions work underway in the government, better than you, of course, to the information comments in the government”, – said Peskov. At the same time, the very idea he called “interesting.”
In turn, the Deputy head of the Ministry of Finance Ilya Trunin said that the Agency does not consider the idea to return the relevant NSP, and discusses the possibility of its implementation in the framework of the tax maneuver.
“Not discussed the sales tax, because sales tax is really the last day,” – said Trunin (quoted by “RIA Novosti”).
The Deputy Minister also called on people not to be surprised by the abundance of tax initiatives, explaining that the tax reform options will be discussed throughout 2017. Among the discussed proposals, the official said that the idea of linking the sales tax to the amount of profits, not of sales floor area and other “natural factors”.
How charged sales tax
Sales tax was introduced in Russia twice – in 1991 and 1998. The first time NSP rate was set at 5%, and the collected money was proposed to send on programs to support the poor. But in 1992, NSP available in Russia taxes were eliminated, it was replaced by a value added tax.
The second coming of the NSP took place in 1998 when the authorities of the regions received the right to enter on its territory, setting the rate from 0 to 5%. However, in January 2003, the constitutional court stated that the NSP violates the rights of individual entrepreneurs, who are forced to pay it when buying goods for cash, and their payment in the form of cash, while the legal person from the payment of sales tax on non-cash payments for goods released. The constitutional court recognised that such an order violates the constitutional principle of equal tax burden, and from January 1, 2004, NSP was cancelled.
Promised to return
Later authorities have repeatedly stated about the possibility of returning the NSP. In July 2014, Finance Minister Anton Siluanov said that the Russian government is considering to provide the authorities with the regions to implement on-site sales tax in the amount of up to 3%.
That summer, the Agency Reuters with reference to anonymous sources in the government said that the Russian President allegedly supported the return of the sales tax in 2015.
“The sales tax with a trade up to three per cent by the decision of the region. All will be in the budget of regions”, – said one of the sources Reuters. Another reported that the decision was taken following a meeting of the President with key officials of the financial-economic bloc, which discussed tax issues.
However, in December 2014, addressing a message to the Federal Assembly, Putin stated that “strongly agree” with the entrepreneurs who say about the need for stable tax legislation.
“I suggest for the next four years to fix the current tax environment and this issue never come back, not to change them”, – said the head of state.
In November 2016, the first Deputy Prime Minister Igor Shuvalov announced an update of the tax system after the completion of the term imposed by the President of the moratorium and carrying out in 2017, “a broad discussion”.
“There is a preliminary understanding from the administration and from the Central Bank and the government that it is necessary to prepare for the new tax the aggregate, so that the whole of the next political cycle, too, was stable, all the tax decisions were stable. I think in 2017 it will be publicly very serious sounding”, – said Shuvalov.
The first Vice-Premier noted that all decisions must be taken “at the latest” before the end of the spring session of the Duma in 2018.
In the next address to the Federal Assembly in December 2016, Putin recalled introduced in 2014 a four year moratorium and noted that its adoption “certainly has a positive impact on the operation of enterprises”. At the same time, the President pointed to the need for reorientation of the tax system.
“I propose in the next year in detail and comprehensively to consider proposals for setting up of the tax system, be sure to do it with the participation of business associations. Despite the political calendar, we still need in 2018 to prepare and make all appropriate amendments to the Tax code, and from 1 January 2019 to enter them into action, registering a new stable rules for a long-term period”, – said the President.