Russian grocery chains demanded tax incentives to keep price increases

Russian producers of socially important goods, which are subject to preferential taxation, as well as retail chains, called on the authorities to introduce new benefits to curb price increases. Kommersant writes about this with reference to industry representatives.

Thus, the Association of Retail Trade Companies (AKORT) sent a letter of demand to the head of the Federal Tax Service, Daniil Egorov. Retailers are asking for a reduction in value-added tax (VAT) for essential goods and bananas, an extension of the grace period for paying VAT for a year, and easier tax deductibility for stolen products.

Currently, a preferential VAT rate of 13% is set for socially important goods, but representatives of retail chains demand that this threshold be lowered, since the tax does not allow restraining price increases. AKORT recalls that in spring inflation in annual terms reached a record 20%, tax cuts would also reduce prices for the declared categories of goods, up to 10% of the cost.

However, representatives of the bread and dairy industries offer their own options. President of the Russian Union of Bakers Alexei Lyalin does not see much point in reducing the tax burden and insists on simplifying access to money for investment and the creation of new industries. The director of the analytical department of Soyuzmoloko, Alexei Voronin, insists on measures that would support the incomes of Russians and stimulate consumption.

In AKORT, they see tax breaks as an opportunity to free up that same money for investment. “The annual deferral of payments for the third quarter of 2022 will enable chains to free up resources for investments in the stability of supplies and maintaining affordable prices,” said Igor Karavaev, chairman of the AKORT presidium.

The Association specifically asked to simplify the mechanism for recognizing corporate income tax expenses in case of theft of goods. Retailers insist that the current mechanism does not work due to the irresponsibility of law enforcement agencies, who are unwilling to file cases of theft, because it "spoils their statistics." Losses from theft of companies can be officially reflected in the reporting only after confirmation from the authorities, thus, without a paper from the police, it will not be possible to reduce the tax burden.

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