Ten-year tax breaks to be introduced in Kurils for both Russian and foreign investors - Putin

VLADIVOSTOK. Sept 3 (Interfax) - A preferential tax regime will be introduced in the Kuril Islands for ten years and it will be available to both Russian and foreign investors, President Vladimir Putin said at the Eastern Economic Forum (EEF).

"We will create an unprecedented package of preferences and incentives in the Kuril Islands, where we will completely exempt businesses from paying key taxes: on profit, on property, the land and transport tax. And for ten years. I stress that this refers to companies that not just register in the Kurils, but actually work on the islands, build buildings, enterprises, hire employees. Reduced insurance contributions in the amount of 7.6% will also be set for such companies, also for ten years," Putin said.

"Furthermore, there will be a free customs zone on the whole territory of the Kuril Islands, meaning it will be simpler and more convenient to import goods, equipment and export finished products. Within this zone, the VAT will also not be collected until the good leaves the territory of the Kurils," Putin said.

However, the "preferential regime will not extend to all types of activity - exceptions will be the work of intermediaries, production of goods subject to excises, production and processing of hydrocarbons, as well as catching valuable marine bioresources, understandably, because these are already highly profitable types of activity, highly profitable businesses," Putin said.

"And I stress, the tax, customs and administrative privileges will not only be available to Russian companies, but also to foreign investors, including of course our neighbors, including Japanese partners, which we previously talked to them about in the way of creating conditions for the development of these islands' economy and our cooperation in these territories," Putin said.