The Ministry of Finance of the Russian Federation has prepared a draft law on changes to the tax system. Among other things, it proposed to set a 5% profit tax rate for IT companies instead of the current zero rate.

As reported by TASS, which reviewed a copy of the draft law, they plan to raise the rate starting January 1, 2025. If the initiative is adopted, the 5% rate will be in effect at least until the end of 2027.

Recall that the reduced rate for IT companies has been in effect for four years. Initially, in 2020, it was reduced from 20% to 3%, and in 2022 it was temporarily set to zero, allowing companies to avoid paying profit tax up to December 31, 2024. In March 2023, the Ministry of Digital Development of the Russian Federation proposed permanently zeroing out the rate, but it appears the idea was not supported.