Local - time: regions will be able to give businesses a deferral of federal taxes
Regions will be allowed to grant businesses deferrals, installments and investment credits not only for local taxes, but also for federal taxes, the Ministry of Finance told Izvestia. It is about mandatory payments from profits and revenues, as well as fees under the simplified and patent systems. Expanding the powers of subjects and municipalities will make the approach to the collection of payments to the budget more flexible and adaptive, experts believe. However, it also increases the risks of collusion between local authorities and companies and unfair business behavior. Izvestia has analyzed who will eventually be able to claim tax benefits in the regions.
How to get a tax deferral
Regions and municipalities will be allowed to grant deferrals, installments and investment credits for federal taxes - but only for those that are credited to local budgets. This was reported to "Izvestia" in the press service of the Ministry of Finance. The Ministry added: such changes can be introduced into the legislation from 2025 to 2027.
Now the subject can determine the grounds and procedure for the appointment of such benefits only on local fees - on property, transportation and gambling, as well as land and trade fees. Now local authorities (as a rule, these powers lie with tax and financial authorities) will be allowed to grant deferrals for federal payments, which are credited to the budget of the subject.
Such federal fees as income tax, payment under the simplified taxation system (USN), unified agricultural tax (UAT) and patent system fee are paid to the regional treasury, reminded Vladimir Gromov, senior researcher of the Tax Policy Research Laboratory of the IPEI of the Presidential Academy. That is, they will be subject to the new legislation.
There are three ways for individuals and legal entities to postpone the payment of taxes:
Deferral - a lump-sum payment at a later date. It is provided for a maximum of one year;
Installment - phased repayment of debt with a maximum period of three years;
Investment tax credit - a kind of loan from the government, which allows businesses to postpone tax payments until later, and spend the saved money on investments.
Tax deferrals and installments are now granted in cases where:
- damage is sustained due to a natural or man-made disaster;
- a lump-sum payment of taxes may lead to bankruptcy;
- the government customer has paid for the work late or partially;
- the company's activity depends on the season
- due to the property situation it is not possible to pay at once;
- additional charges have arisen after an audit and there are grounds for installments;
- the budget funds promised to the entrepreneur were not received in full.
Investment loans are intended for organizations that invest in their own development or for the benefit of the state.
In most cases, for the use of deferment or installments accrue interest - for a year they are calculated as ½ of the Central Bank rate or in its full amount. And in the case of investment loans - ½ or ¾ of the key rate, but no more than 15% per annum. That is, it is more favorable than taking a loan from a bank, where, as a rule, interest is higher than the key rate.
At the same time, the benefit may even be gratuitous if the company has suffered due to a natural or man-made disaster.
"Izvestia sent a request to the regions asking them to tell us how they provide such benefits. In Chuvashia shared that in the subject for the 2024th was 76 appeals for installment - on the USN, unified agricultural tax, taxes on property, income, transport and profit. In Crimea this year agreed 23 applications for installments and deferrals.
In Kaluga and Leningrad regions only specified which bodies make decisions, but did not name the figures. The first subject said that the responsibility lies with the tax authorities. In the Leningrad region the decisions of tax authorities are coordinated by the Finance Committee.
Pros and cons of expanding the tax powers of regional authorities
- Expanding the list of taxes, the payment terms of which can be regulated by regions and municipalities, will make the fiscal system more flexible and adaptive. Both subjects and business will benefit from it," Vladimir Gromov from the Presidential Academy is sure.
The new measure will help companies to cope more easily with financial difficulties, reducing the fiscal burden by legal means and not resorting to dubious schemes, the expert believes. And the regions, according to him, will get more tools to manage tax flows - all this will contribute to the development of fiscal federalism (the principle of separation of powers between federal and regional authorities in the financial sphere).
At the same time, the innovations may create an additional administrative burden for business due to the difficulties with reporting, which each region may require its own, believes Yulia Kovalenko, associate professor of the basic department of financial control, analysis and audit at Plekhanov Russian Economic University. However, the measure may have a favorable impact on the investment attractiveness of the subjects.
However, the initiative also has potential disadvantages. Andrei Barkhota, a candidate of economic sciences, believes that there are likely to be risks of abuse of such benefits. For example, if the freed financial resources will be directed to deposits.
Freedom Finance Global analyst Vladimir Chernov added that in this case the risk of collusion between business and local authorities increases, as there are opportunities to grant benefits to companies that do not meet the criteria for receiving them.
In addition, the organizations themselves may begin to allocate resources inefficiently, expecting that the regional authorities, interested in business development, will still give them a delay.
In addition, there is a danger of tax shortfalls in budgets, the expert added. Competition between regions is likely to grow. After all, administrative mistakes cannot be ruled out when granting benefits.
