Russian govt agrees to postpone elimination of VAT break for domestic software

MOSCOW. Oct 23 (Interfax) - The Russian government has decided it is possible to postpone the elimination of the value-added tax break for the sale of Russian software and will make the relevant changes to the bill to amend the Tax Code for its second reading, Deputy Prime Minister Dmitry Grigorenko, who serves as government chief of staff, said.

The government carefully reviewed the arguments cited in appeals from information technology industry association regarding the elimination of the VAT break for domestic software and analysed the position of the specialized government agency on this issue, he said.

"Following discussions (consultations) conducted with the Finance Ministry of Russia, State Duma deputies and senators, the government believes it is possible to postpone the elimination of the current VAT break, which could now have a negative impact on the pace of development and introduction of Russian software in the economy," Grigorenko was quoted as saying by his office.

The government plans to make changes for the bill's second reading to scrap the elimination of the VAT break for domestic software developers, he said.