Putin announced the rejection of the flat rate personal income tax

Russian President Vladimir Putin offered from January 1 to cancel the flat rate personal income tax. The head of state proposed to increase the tax from 13 to 15 percent for those earning more than five million rubles a year.

Putin noted that the introduction of the flat rate on income of natural persons in the time allowed lift wages and incomes out of the shadows, to simplify tax administration. Now with the new quality of administration the introduction of digital technologies, the opportunity to distribute the tax burden more differentially and send additional financial contributions to the solution of specific, important for the society problems.

Putin said that the increased rate of personal income tax will only apply to incomes that exceed voiced threshold. It is expected that additional revenues from these measures will amount about 60 billion rubles annually.

the President offered to “paint” these funds in the budget that will allow you to protect against any other use and appropriately used to guide treatment of children with orphan diseases.

According to estimates of the National rating Agency credit ratings (NKR), increasing tax rates will increase tax revenues to about 130 billion rubles a year.

Informed magazine Forbes reported citing its sources that the government during the crisis caused by the pandemic coronavirus, discuss the possibility of increasing tax fees with the rich. According to the publication, including discussed the increase in the personal income tax rate from 13% to 15% for wealthy individuals whose annual income exceeds 2-3 million rubles.

According to Rosstat, in Russia the average salary is at a level of 47 000 and over 100 000 per month receive 7.1% of the working citizens. Moreover, 6.3% of the salary does not exceed 250 000 rubles.

Now Russia has a flat rate personal income tax of 13% for all individuals. A bill to impose a progressive scale of taxation and BBdistribution of tax benefits for the poor previously sent to the government of the party “Fair Russia”, but it proposed to raise personal income tax, starting with income of 24 million rubles a year. The idea to introduce a progressive scale of tax on income of physical persons was supported by all factions of the state Duma.

Press Secretary of the President Dmitry Peskov confirmed that the issue of increasing personal income tax rate for wealthy Russians discussed at the expert level, including in government and in the Kremlin. Before the appointment of the Prime Minister Mikhail Mishustin, who previously headed the tax service claimed that it did not support the rejection of the flat rate personal income tax.