German foreign minister says long-term solution to Syrian crisis to be discussed in GenevaWorld January 23, 17:34
Finland does not view Nord Stream-2 construction issue as politicalBusiness & Economy January 23, 17:02
UN envoy urges Syrian armed opposition to abide by ceasefireWorld January 23, 16:00
Russia’s anti-ballistic missile defense system to be upgraded by late 2017Military & Defense January 23, 15:41
Russian top lawmaker says no plans to set up new military bases abroadRussian Politics & Diplomacy January 23, 15:29
Russian strategic bombers hammer Islamic State facilities in Syria’s Deir ez-ZorMilitary & Defense January 23, 15:02
Putin backs granting profitable routes to national airlines using Russian aircraftBusiness & Economy January 23, 14:59
Rosneft will boost oil supplies to China to 31 mln tonnes in 2017Business & Economy January 23, 14:29
Damascus insists operation against radicals in Wadi Barada not ceasefire violationWorld January 23, 14:20
MOSCOW, November 19. /TASS/. The Federation Council, the upper house of Russia’s parliament, approved a new tax law on Wednesday as part of President Vladimir Putin’s "deoffshorization" initiative designed to return Russian capital and assets from foreign jurisdictions.
The law introduces amendments to the country’s tax code that will oblige Russian owners of companies registered in offshore tax havens to pay taxes in Russia.
The law stipulates a mechanism for taxation of undistributed profits of controlled foreign entities.
The document obliges Russian tax residents to declare undistributed profits of controlled foreign companies. Minimum profits subject to declaration will equal 50 million rubles (about $1 million at the current exchange rate) in 2015, 30 million rubles ($638,000) in 2016 and 10 million rubles ($212,000) after 2017.
Under the document, a Russian company or individual with ownership of more than 50% of a foreign organization in 2015 and with 25% such ownership from 2016 are categorized as “controlling entities.” The individual threshold will fall to 10%, if Russian residents’ total shareholding is more than 50% of a controlled foreign company.
The law also stipulates penalties for failure by controlling persons to fully declare and pay taxes into the Russian budget. The penalty for such violations will amount to 20% of the unpaid tax but no less than 100,000 rubles ($2,120).
Failure by controlling persons to submit information or failure to submit authentic information will entail a penalty of 100,000 rubles for each controlled company, on which data are not provided.
At the same time, the existing Russian legislation stipulates criminal responsibility for tax evasion.
Deputy Chairman of the Federation Council Committee for Economic Policy Sergey Shatirov has said “Russia holds a leading place in the world among developed states by the scope of the use of offshore schemes.”
“A large part of the Russian economy is linked to offshore tax shelters in one way or another. The use of offshore havens by Russian business causes large damage to the country’s interests,” the senator said, adding that anonymous ownership and control of offshore structures were used for criminal activity, including for tax evasion and corruption.
The implementation of the new tax law will yield an additional 150-200 billion rubles ($3-4.3 billion) in tax revenues for the Russian budget annually, the senator said.
Meanwhile, capital outflow through offshore schemes is estimated at $200 billion this year alone, he said.
Overall, about $2 trillion has fled Russia in recent years through offshore schemes, according to expert estimates.
“Deoffshorization is an important issue in ensuring national security,” the senator said.
Meanwhile, Deputy Finance Minister Sergey Shatalov has said taxation of controlled foreign entities will yield up to 20 billion rubles ($425 million) a year.