The Ministry of Finance proposed to reduce the tax burden for Russians. The relaxations will affect the payment of personal income tax (PIT) upon dismissal, the tax deduction for medical services for disabled children, as well as the payment of PIT for purchased real estate. The list and explanation of the benefits are reflected in the draft "Guidelines for the budget, tax and customs tariff policy for 2023 and the planning period of 2024 and 2025", to which RBC refers .
At the moment, Russians have the right to exemption from personal income tax when parting with the employer only in cases of employee reduction or company liquidation. In all other cases, tax is charged. The Ministry of Finance also proposes to expand the benefits and exempt from personal income tax payments of severance pay, average monthly earnings for the period of employment and any other compensation payments upon dismissal of an employee.
For a tax deduction for paying for medical services for disabled (by court order) children, the Ministry of Finance proposes to remove age restrictions. Previously, parents could apply for benefits only until the child reaches the age of majority.
The last proposed benefit is optional, the Ministry of Finance wants to offer it to the regional authorities, who will independently determine whether to introduce it or not. It concerns the minimum period of ownership for exemption from personal income tax in transactions with real estate that has been inherited, privatized or donated. The current minimum holding period for donated property is 3 years, for other types of property it is 5 years. Regions will be able to reduce these terms.
Experts, however, do not see any real economic effect in the proposed easing, assessing the effect of them as "close to zero." “Many families in Russia, given the low incomes in the country, use inherited housing themselves or rent it out rather than sell it. As for families with disabled children, few of them can afford paid medical services, the deduction for the expenses for which they will expand, ”said Alexander Safonov, Doctor of Economics, Professor at the Financial University under the Government of the Russian Federation. He also does not believe that the regions will reduce the minimum tenure, as it is unprofitable for them - less revenue to the local budget.
Lyudmila Kruglova, head of the Structural and Tax Consulting practice at Lemchik, Krupsky and Partners, sees in the benefits of the Ministry of Finance opportunities for top management of large companies to evade taxes. According to her, managers will deliberately quit their jobs in order to exempt their income from taxes, after which they will be hired again.
This is not the first time that the Ministry of Finance has announced changes to tax legislation, but earlier the innovations were associated with a sharp drawdown in Russian budget revenues due to sanctions imposed against Russia because of the war in Ukraine.
