Overview of Tax events for May 2019

Regulatory developments

The Russian President has signed the following laws:

• to ratify the Multilateral Convention on preventing profit shifting;
• to ratify the Protocol to the Convention between the Russian Federation and Austria for the avoidance of double taxation with respect to taxes on income and on capital;
• to grant an exemption from taxes and levies in connection with preparing for and staging the Euro 2020 football tournament in Russia.

The Russian Government has adopted:

• rules for collecting a new type of port duty, the ‘investment port duty’, introduced as early as in 2017. The duty will be levied on cargo ships sailing to foreign destinations and, in some cases, ferries, passenger and fishing vessels;
• common labelling rules for goods and the regulation regarding the state information system for monitoring the turnover of goods subject to mandatory labelling by means of identification.

By order No. 47n of the Russian Ministry of Finance dated 22 March 2019, the procedure for registering major taxpayers with the tax authorities has been updated.

The State Duma has had a government bill submitted to it (No. 720839-7) concerning amendments to the Russian Tax Code with regard to implementing individual provisions of the basic directions of tax policy.

The Russian Government is preparing an agreement with the Centre for the Development of Advanced Technologies (known in Russian under the acronym “CRPT”, the “operator”) regarding the system for the labelling of goods and the list of such goods being expanded. CRPT is already labelling tobacco products and, as an experiment, medicines; starting from June, the Russian Federal Tax Service will grant control of fur products to the company as well.

The Russian Ministry of Economic Development has suggested the concept of adigital special economic zone for the IT sector featuring many benefits, including tax benefits.

The Minister of Finance and the Russian First Vice Premier Anton Siluanov has proposed to equalise personal income tax rates for Russian citizens and foreign nationals (residents and non-residents).

Practice

The Russian Federal Tax Service has prepared a review of court disputes in relation to the implementation of international tax treaties and abuses of law during cross-border transactions.