On Monday, April 24, the Russian government sent to the State Duma a bill on amendments to the Tax Code regarding citizens working from abroad. If the document is approved, the business will be obliged to levy an increased personal income tax (PIT) from employees who have gone abroad.
"According to the proposed amendments, from January 1, 2024, Russian companies - employers and customers will charge personal income tax on the remuneration of employees or performers who have left the country at a base rate of 13-15%, and after the loss of tax residency - 30%," the website of the lower house of parliament says.
It should be noted that tax residents of the Russian Federation include those who have been in Russia for at least 183 days during the year, and not necessarily in a row. Otherwise, the person loses the status of a tax resident of the country.
Since January 1, 2021, Russia has a progressive tax scale. So, today for all tax residents of the Russian Federation earning more than 5 million rubles a year, the personal income tax rate is 15%, and for other citizens - 13%.
In turn, non-residents are already required to pay income tax in the amount of 30%, but must do it on their own. Meanwhile, the Cabinet of Ministers now proposes to shift to employers all responsibility and control over compliance with the payment of personal income tax by such employees.
"In principle, the initiative is justified, since it is easier for companies to check their counterparty employees than for the tax authority. The amendments are rather aimed at returning those who left back to Russia and encouraging those who are going to do so not to leave, "Pavel Gerasimov, general director of the Padva and Epstein law firm, told RT.
As stated in the State Duma, the innovations will have to affect all citizens who have left the country and who use the Russian segment of the Internet or hardware and software located in the Russian Federation for work. An increased tax will be levied if a person receives remuneration to an account in a Russian bank or the payment comes from domestic organizations, individual entrepreneurs, as well as separate divisions of foreign structures in the Russian Federation.
"Russian companies will determine in each case what personal income tax rate to apply, assessing whether their employee or contractor carries out their activities in Russia or not," the State Duma added.
At the same time, as specified in the Ministry of Finance, the amendments will not affect employees who have left Russia if they work under employment contracts - for them the tax conditions will not change in any way. At the same time, the department stressed that at the moment the bill is still being finalized.
If, in the end, the government's initiative is approved, it will become more difficult for Russians working abroad to evade taxes. This opinion was shared with RT by Polina Gusyatnikova, senior managing partner of the law firm PG Partners.
"Innovations are unlikely to have any serious impact on those employers and employees who have previously acted in compliance with the law. If someone tried to evade taxes in this way, then it will now be more difficult for them to do so. Perhaps such a measure will really be an incentive for someone to return back to the country, "the interlocutor of RT did not rule out.
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A similar point of view was expressed in an interview with RT by the director of the Center for Market Studies of the Institute for Statistical Studies and Economics of Knowledge at the Higher School of Economics, Georgy Ostapkovich. According to the expert, first of all, the initiative is aimed at returning IT sector workers to Russia.
"People in this industry can perform their functions remotely in full. In addition, it was from the IT sphere that most Russians went abroad. However, you need to look very carefully at who left and for what reason, and introduce any tax innovations thoughtfully and carefully, so as not to scare people away. The financial reason for the amendments is clear: these workers receive their salaries from Russia, and consumer demand is supported abroad, "Ostapkovich explained.
A similar position is held by Alexander Kalinin, President of the All-Russian Public Organization of Small and Medium-Sized Businesses Opora Rossii. According to him, many of those who left continue to pay one of the lowest income taxes in the world, but at the same time live and spend the bulk of their funds in other countries, which is negative for the Russian economy.
"One of the key goals of the project is to replenish the budget. Income tax goes primarily to regional and municipal budgets, and social expenditures, public sector salaries and infrastructure spending in the constituent entities of the Russian Federation are formed from them. So the cause is good and socially just," Kalinin concluded.