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Amendments to Tax Code signed by President — Orbitax Tax News & Alerts

On 22 July 2008, the President signed the laws on changes and amendments to the Tax Code earlier adopted by the State Duma (the Lower Chamber of the parliament) and approved by the Council of Federation (the Upper Chamber of the parliament).

Amendments to Tax Code

Details of the bills on changes and amendments to the Tax Code adopted by the State Duma (the Lower Chamber of the parliament) on 2 July 2008 have become available. To become law, the bills must be approved by the Council of Federation (the Upper Chamber of the parliament) and signed by the President. It is expected that changes will enter into force from 1 January 2009.

The most important changes and amendments are as follows:

Corporate income tax

It is expected that the thresholds for corporate deductions will be increased as follows:

-   non-obligatory insurance payments for medical insurance of employees: from 3% to 6% of the labour costs; and
-   expenses on acquisition of computer software programs: from RUR 10,000 to 20,000.

Educational expenses and mortgage interests paid by the employer on behalf of an employee will be subject to corporate deduction. Additionally, those amounts will be exempted from individual income tax and unified social tax.