Tax privileges for IT companies extended until 2023
In a crisis, taxes need to be reduced, not increased
Today, the president signed an instruction to the chairman of the government of the Russian Federation to preserve benefits for the payment of insurance premiums in respect of IT companies producing domestic software. Benefits are valid from January 1, 2012 , and now extended until 2023.
Under current conditions, Russian IT companies that have passed a special accreditation with the Ministry of Communications, pay insurance premiums to extra-budgetary funds at a reduced rate of 14% of the payroll instead of the standard 30%. This is a critical indicator for software companies in which wages make up the bulk of all costs. For example, startups have a salary of 80-90% of all expenses .
Benefits planned to cancel in 2018. The Ministry of Finance and the Ministry of Labor insisted on it stubbornly, but experts from the working group of representatives of the Ministry of Communications and the Ministry of Economic Development and industry associations presented convincing arguments that the benefits for IT companies are useful for the industry and the entire economy.
In particular, since 2010, there has been a twofold increase in the revenue of IT companies receiving benefits, an increase in the number of employees by 30% and, most importantly, an increase in tax revenues in half. That is, a reduction in the rate of insurance contributions de facto increased the amount of tax revenues to the budget.
Tax relief is an excellent measure to stimulate the economy, especially in a crisis period.
On the effectiveness of benefits (Ministry of Communications)
According to InfoWatch , thanks to the benefits in 2010-2014, the volume of sales of Russian software has increased from 28 to 102 billion rubles.
Officially, the Minister of Communications and Mass Media Nikolai Nikiforov addressed the proposal to extend the benefits to Prime Minister Dmitry Medvedev. In October 2015, the government agreed with the proposal of the Ministry of Communications.
The Ministry of Communications and the Ministry of Economic Development and Trade explained that the abolition of tax incentives for IT companies would be a serious blow to IT companies: in such circumstances, nothing can stop them from transferring business outside the country. You can simply open development departments abroad — there you can hire developers and pay taxes.
Representatives of the Ministry of Finance and the Ministry of Labor were unable to bring decent counter-arguments. For example, the Ministry of Finance opposes granting benefits not only to IT companies, but to any companies in principle, because it puts them in unequal conditions.
Earlier it was planned that the benefits will cease to operate at the end of 2017. From 2018, IT companies had to deduct insurance premiums of 21%, from 2019 - 28%, and from 2020 - like everyone, 30%.
Now it has been decided that IT companies will retain the benefit of 14% for at least another seven years.
Benefits for IT companies for insurance premiums: a reference section on Habrahabr