Putin Calls For Stabilisation Of The Tax System

by Tatiana Smolenska, Tax-News.com, Moscow

22 March 2004

Russian President Vladimir Putin has called for a period of long term stability in the taxation system once current reforms are complete, in order to promote a more stable environment for businesses to make decisions.

"It is very important that after completion of a tax reform, the basic components of the tax system are not reviewed for many, many years to come," commented Putin in an address to his economics ministers.

The country has experienced a plethora of tax changes in recent months, as Putin attempts to fulfill his pledge to double the size of the economy over ten years. Last year the Duma approved a package of tax reforms including a cut in VAT and abolition of the 5% sales tax. Changes are also taking place in social security taxes, and there are plans to extract more tax revenues from the oil and gas industry, with the possibility also of a further reduction in VAT in 2006.

Added to this, the newly appointed Prime Minister Mikhail Fradkov has also announced that he wishes to see a radical overhaul of the tax administration system.

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