The Ministry of Economy of Russia has proposed a strategy for the development of services exports until 2025. One of the proposals is to remove the tax on profits from the export of telecommunications, computer and information services.
This is reported by the Kommersant newspaper with reference to the document. It is assumed that the relevant changes to the Tax Code can be made before the end of 2019.
It is unclear how realistic the introduction of such measures is. The Ministry of Finance, the Federal Tax Service and the Ministry of Economy responsible for the initiative did not provide our colleagues from Kommersant with comments.
Such a measure will be a good incentive for the development of the market. Now domestic companies earning large sums on the international market prefer to work through Western jurisdiction.
At the same time, as Alexander Pakhomov, managing partner of the Law and Business Management Company, noted in a conversation with the publication, the application of a zero income tax rate for exports “does not negate the presence of legislative and political risks that also repel investors [from working in Russia].”
According to the Russian Ministry of Economy, in the first nine months of 2018 alone, exports of such services amounted to $3.83 billion.
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