Revenue threshold for VAT for SMEs using simplified system to go from 20 mln rubles in 2026 to 10 mln rubles in 2028 - Russian PM
MOSCOW. Nov 6 (Interfax) - The Russian government has accounted for the wishes of businesses and members of parliament, and proposes a gradual transition to VAT payment for small- and medium-sized businesses on a simplified tax system, thereby lowering the revenue threshold to 10 million rubles over three years, Prime Minister Mikhail Mishustin said at a government meeting.
Mishustin said that deputies, senators, the business community, experts, and public organizations submitted amendments regarding changes to tax legislation during the discussion of amending the second reading of the federal draft budget for 2026-2028.
"The amendments have been accounted and reported in detail to the president. The terms and conditions for applying VAT on small- and medium-sized businesses should be relaxed, with a gradual change in the payment thresholds, starting with revenues of 20 million rubles in 2026, 15 million rubles in 2027, and 10 million rubles in 2028," Mishustin said.
Meantime, Mishustin said that a moratorium on prosecution may be established to eliminate potential risks for taxpayers who violate VAT payments for the first time in accordance with the new regulations given the government's authority.
It is also proposed to give small businesses that are becoming VAT payers for the first time "a one-time option in the first year to refuse the application of the reduced VAT rate before the expiration of the three-year term, in order to minimize the risks of such newcomers incorrectly assessing all existing VAT options for their business," Finance Minister Anton Siluanov said. In addition, it is proposed not to limit the possibilities of applying the patent taxation system in the sphere of stationary trade and the provision of road transport services for the carriage of goods, he said.
Neither Mishustin nor Siluanov mentioned the fate of another appeal aimed at adjusting the proposed tax initiatives in their comments on the draft amendments. This concerns plans to increase the tax burden for the bookmaking business, which the heads of sports federations in a collective letter to Mishustin described as a risk to the funding of mass and youth sports in the country.
As part of benefits for citizens, the amendments propose, for a uniform approach, to tax individuals' income in the form of interest on bank deposits only with personal income tax, excluding such income when determining the tax bases of individual entrepreneurs on special tax regimes, such as the Unified Agricultural Tax, the Simplified Taxation System or the Automated Simplified Tax System.
"It is proposed that a benefit on transport tax for [those awarded the title of] Heroes of Russia be introduced. An exemption for individuals from paying land tax and property tax on properties located in territories where a state of emergency or a CTO [Counter-Terrorist Operation] regime has been introduced, providing for the temporary resettlement of residents, has also been taken into account. It is proposed that such an amendment be introduced retroactively from 2024," Siluanov said.
