Taxes and tax reforms in Russia: description, features and directions

Since 1990, a large-scale tax reform has begun in the Russian Federation. In April, a bill was introduced on fees from citizens of the country, foreigners and stateless persons. In June, a normative act on mandatory deductions to the budget of enterprises, organizations and associations was discussed.

Taxes and tax reforms in Russia: regulatory framework

The key provisions of the current program for collecting mandatory payments to the budget were approved at the end of 1991. Then the main law regulating this area was adopted. The normative act established taxes, duties, fees and other deductions, defined subjects, their duties and rights. In addition, other laws on specific taxes were adopted, which came into force in January 1992. The main tax reforms, therefore, took place at the beginning of the last decade of the last century.

Structure

The reform of the tax system took place with the adoption of more than 20 regulations. On November 21, 1992, by decree of the president, a controlling independent body, the Federal Tax Service, was formed. This service was entrusted with key functions for the development and subsequent implementation of the country's tax policy. The legislation defined 4 groups of fees:

1. Nationwide. They were installed at the federal level.
2. Local. They were determined by the territorial structures of power, in accordance with the legislative acts of the subjects.
3. Republican fees, taxes of administrative and national-state entities. They were established by decision of state bodies and the laws of the respective regions.
4. Obligatory republican and local fees and taxes.

The composition of contributions was periodically changed in accordance with the decisions of state bodies.

First problems

Conducted in rather extreme conditions, tax reform in Russia could not ensure the creation of an ideal financial institution. In the course of subsequent market transformations, its flaws became more and more noticeable. As a result, the tax system began to significantly slow down the country's economy. The key problem at that time was the budget deficit. It was due to insignificant volumes of revenues to the treasury against the background of significant spending obligations.

Changes

By 1997, the country had established more than 40 types of fees and taxes paid by organizations and citizens. At this point, a three-level structure was formed. She included:

1. National fees. They were charged throughout the country at uniform rates for each species.
2. Republican fees and taxes of administrative-territorial and national-state formations.
3. Local deductions to the budget.
   

Second phase

A new tax reform began in 1999. It was marked by the entry into force of the first part of the Tax Code. It should be said that the Code was discussed for a long time. In the general part, the obligations and rights of the subjects were established, the process of fulfilling obligations to the budget was regulated, the control rules and the responsibility for violations of tax legislation were determined . In addition, the most important tools of the institute were introduced. Thus, the Code reflected the main aspects of tax reforms. To ensure the introduction of legislation into force, more than 40 regulatory documents were developed and agreed. The most important result of that period was the approval of the forms of declarations and instructions for their preparation. However, it is worth noting that while the document passed through the Duma, he lost many innovative proposals. Moreover, the mechanisms and rules turned out to be far from perfect. In this regard, over the past few years, many amendments have been introduced to the Tax Code.

Conversions since 2000

Since the beginning of the 21st century, the Government has taken several decisive steps to change the current situation in the financial sector of the country. Priority directions of tax reforms for the medium term were developed (until 2004). First of all, it was supposed:

1. Reducing the excessive burden on the subjects, as a result of which the prerequisites were formed for evading the payment of mandatory amounts.
2. The weakening of fiscal control of the state in favor of the stimulating functions of the tax system.
3. Ensuring uniform distribution of load on payers.
4. Reducing the number and direction of established tax benefits.

In the framework of intergovernmental relations, the government focused on the redistribution of revenues in favor of the federal budget relative to regional ones.

Tax reform objectives

They are not about collecting as many payments as possible to solve the budget crisis. The key task today is to reduce the level of exemptions as government obligations decrease. Tax reforms are aimed at establishing a fair procedure for collecting payments from entities operating in various economic conditions. Approved programs of state financial policy suggest an increase in the level of neutrality. Taxes should not significantly affect relative prices, accumulation processes, and so on. As a result, the costs of enforcing legislation should be reduced not only for the state, but also for the payers themselves.

Subsequent Conversions

To implement the above tasks, tax reforms in the country were continued. In particular, since January 2001, 4 chapters of the second part of the Tax Code were introduced:

1. VAT.
2. Excise taxes.
3. Personal income tax.
4. UST.
   

Subsequent tax reforms for 2005 included:

1. Decrease in load on payroll. This was planned to be achieved by reducing the UST rate. It was assumed that for incomes up to 300 thousand rubles. it will be reduced to 26%, from 300 to 600 - to 10%, over 600 - to 2%.
2. Change in the regime of charging VAT. It was envisaged that the rate would be reduced to 16%. In addition, tax reforms included a review of the return to exporters. In addition, the possibility of providing payers of electronic invoices was actively discussed.
3. Change in property taxes. It was supposed to replace the existing fees for deductions from real estate. This practice was, in particular, introduced in the Tver region.
4. Establishment of a preferential regime for enterprises operating within special economic territories. This was to ensure innovation and investment.

Collection and control processes

Tax reforms focus on flexibility and transparency, simplifying and reducing the volume of workflow. The implementation of the tasks involves reducing the load not only in the fiscal, but also in the administrative part. In particular, we are talking about reducing the costs of the payer for the implementation of the law. As practice has shown, a decrease in the fiscal burden on some taxes has gone along with a simultaneous increase in administrative pressure. In particular, the volume of financial statements has grown, accounting for the activities of the payer has become more complicated, and control over government agencies has intensified. In this regard, steps have been taken to:

1. Changing the structure of control organs.
2. Information Technology Development.
3. Improving management techniques.
   

Conclusion

The results of the reform of the tax system are generally assessed as positive. Between 2000 and 2003 the share of the load on GDP gradually decreased from 34% to 31%. As a result of the measures taken, a significant change in the structure of revenues is noted. First of all, the share of deductions related to the use of mineral resources has significantly increased. Along with this, revenues from the profits of enterprises decreased, and personal income tax increased almost one and a half times. A high share of fees allocated for social, medical and pension benefits is noted. Their level is within 25%.