According to the ruling, investors will operate under a zero profit tax for the first five years of the project, while for the second five years the tax will amount to 10% instead of the current 20%.
“The companies implementing investment projects must have state registration on the territory of Yakutia, and the projects must be included in the social and economic development program of the municipal region in which they are implemented,” the republic’s Economy Minister Valery Maximov said.
Yakutia’s government has also imposed lower mineral extraction tax coefficients for ore, coal and gold projects in the republic. After the government has approved the beneficial profit tax the coefficient will be zero in the first two years and will amount to 0.2%, 0.4%, 0.6% and 0.8% for from two to four years, from four to six years, from six to eight years and from eight to 10 years.
The benefits do not cover the production of oil, gas and gas condensate and their transportation, as such tax decisions are made on the federal level, Maximov said.
The bill also sets the amounts of capital investments in the projects and the terms of their implementation at no less than 50 million rubles ($1.34 million) in the first three years and no less than 500 million rubles ($13.4 million) for up to five years.
But the projects which are included on the list of fast social and economic development territories cannot use the tax benefits in Yakutia.
The Tomtor iron ore project and the development of the Inaglinskoye field can apply for the tax benefit.