VAT is one of the most significant taxes in the Russian Federation. He replenishes the federal budget of the country. VAT is considered an indirect tax. He rests on the shoulders of the end customers. Those. the more intermediaries (more precisely, the intermediary price) between the producer and the consumer, the higher the state’s income. No one thought, maybe that is why the state is so actively eliminating “outbid”? But this is a completely different topic. We will talk more about the 10 percent VAT (list of goods taxed at this rate). But first, about how the tax came about.
History of the appearance of tax in Russia
In our country, VAT has been in force since 1992. Prior to this, a sales tax was applicable.
But such a measure legally exempted many entities from payment. Then the government of
Yegor Gaidar introduced VAT.
It was then regulated by a separate Federal Law, which was called: “On Value Added Tax”.
In 2000, the law "merged" into the Tax Code. The basis of the collection was taken from the USA. But at the moment, almost all countries apply a similar accrual principle. Only bets differ.
Was it good before?
Those who like to criticize the modern “overwhelming requisitions”, as well as the “sentimentalists” who claim to be “how wonderful it was before,” say that from 1992 to 1993 the tax was 28% (a 10 percent VAT rate looks fantastic against this background). From 1994 to 2004, the rate was reduced to 20%.
Of course, one could argue that "there were no other taxes." But at that time they also reduced personal income tax to 13%. At that time, "everyone came out of the shadows." The state reduced rates, since the majority preferred not to pay anything. The powerlessness of law enforcement and tax services, coupled with high rates, explained the reason for this behavior. Maybe this was remembered by the “admirers of the past”, without paying absolutely any fees.
Where did the VAT come from?
For the first time such a tax appeared in France in 1942 (war by war, and private property above all). But he did not take root, because he had many shortcomings.
It was a kind of sales tax. In 1948, French economists modified it. They created accrual principles that the whole world liked (more precisely, the authorities in all countries, because who likes to pay taxes?).
What is VAT
VAT is a type of indirect tax on goods or services at the time of sale. It is taxed at all stages of production and ultimately rests with the consumer.
That is, the higher the “appetites” of producers, the more profitable the state is. Example, they sold you chicken in a store. Its cost was 50 rubles. And the buyer paid 200 rubles for it. A percentage of 150 rubles (200-50) will have to be paid in the form of value added tax. If the seller “became generous” and the goods “took for what, gave it away”, that is, did not add anything to the initial price, the state would not have received a dime from such a transaction.
It doesn’t matter if the company makes a profit or works at a loss. VAT is not canceled. Hence the conclusion: the more they wind up, the better the federal budget. We’ll think about whether it is necessary for the state to limit the arbitrariness of intermediaries. With such a system, on the contrary, their growth is only beneficial to the budget. Now we turn directly to the tax rates, which are established by the amended Tax Code (2015 edition).
How much do we pay the state?
How to determine how much the state will take with an increase in price? The 2015 Tax Code provides for three rates: 18% (standard), 10% (preferential) and 0% (“customs”). The VAT rates of 10 and 18% are “domestic”.
They apply to
goods and services only domestically. If they are taken outside, then no tax is charged. In the case of payment of VAT when purchasing goods and reselling them abroad, the tax paid is refundable.
10 percent VAT rate: list of goods and services
18 percent is the usual VAT rate. However, there is a list of goods that reduces it to 10. Many entrepreneurs ask the question: "In what cases is 10% VAT applied?" We will try to answer it.
The VAT rate of 10 percent of the list of goods and services implies the following:
- Foodstuffs.
- Domestic air transportation.
- Childen's goods.
- Some medications.
- Periodic printed matter.
The list of all goods was approved by Government Decision No. 908 of December 31, 2004. It is in this document that the entire list is indicated, which falls under the VAT of 10 percent. The list (short) is given below:
- Milk and dairy products.
- Meat in live weight.
- The eggs.
- Cooking fats, vegetable oil.
- Salt.
- Flour and pasta.
- Vegetables.
- Children's and diabetic nutrition, etc.
“My goods weren’t”
If your product is not on our list, and you have a question: "10% VAT in which cases (or rather, to which goods and services) is applied?", You need to look at the Resolution. We have already indicated the number and date. It contains a complete list. As a rule, these are all socially significant groups of goods that are in high demand among citizens.
10 percent VAT rate: air travel
In connection with the economic crisis, lawmakers supported the request of air carriers to reduce VAT to “preferential" 10 percent. On April 1, 2015, the Federation Council approved the bill and approved the benefit from July 2015 until December 2017. Most likely, this period will be extended if the economic situation does not improve.
Everyone is dissatisfied
This law did not satisfy anyone. The government due to the fact that it began to receive less money with a budget deficit. Air carriers argue that this will not solve the problem in the industry.
The head of Aeroflot, Vitaly Savelyev, expressed dissatisfaction with this matter. He believes that in this situation, it is necessary to completely remove the VAT from air carriers for domestic flights. It turns out that from Vladivostok to Moscow it is almost cheaper to get around the world.
Is our Crimea?
An interesting situation concerns the Crimea and Sevastopol. Referendum, accession - we all know this very well. But as regards the legislation, not everything is so simple here. So, the internal regulatory legal acts make us think - is our Crimea? Russian?
This applies to the law on amendments to the Tax Code in 2015, according to which domestic air transportation is subject to a preferential tax of 10%. The same legal act contains the wording “except for trips to Crimea and Sevastopol”.
Apparently, Russian companies are afraid of possible economic sanctions “from recognizing” Crimea as Russian territory. For this, similar regulatory acts on tariffs, taxes, etc. are adopted. Companies do not violate the domestic law, and do not fall under international sanctions.
10 + 10 = 28?
In the section “10% VAT rate: list of goods and services” we said that there is a category of socially significant goods that have a privilege when paying VAT. A complete list of codes and names is prescribed in Decree of the Government of the Russian Federation of December 31, 2004 No. 908.
But what to do when products are “at the junction” of two items. In addition, it seems paradoxical when the products sold consist entirely of “preferential” goods, but fall under 18%.
For example, pizza. It may consist entirely of those products that have come under benefit. Flour, eggs, meat, cheese, etc. But the "connection" of these "social" products in a "delicious" pizza is taxed "to the fullest."
This provision is clarified by letters of the Ministry of Finance dated September 10, 2010 No. 03-07-14 / 63 and the Federal Tax Service of the city of Moscow dated March 16, 2005 No. 19-11 / 16469. According to them, 10 percent VAT is charged on the sale of goods that are included in Government list. The rest fall under 18%.
This list contains the category “pies, pies, donuts”, as well as meat, various cereals, vegetables. But there is no such thing as “pancakes with meat” or “pizza”. Here, officials apply the principle of "what is not allowed is forbidden." They believe that stuffed pancakes should be paid in full 18 percent.
Italian pizza or pie
But there is one loophole. If you want to produce pizza and get benefits for it with VAT, you can sell it like an Italian cake. It is enough to have all the certificates of conformity and quality of products. No one will interfere with changing the name of the product from “pizza” to “pie”; the law does not establish “what should be” in each of these products. The main thing is to indicate the composition of the product.
Arbitration court on the side of entrepreneurs
In addition, entrepreneurs use code classifiers, which mean “bakery products” for pizza, as well as “meat and meat products” for stuffed meat pancakes. Both of these codes “allow” 10 percent to be applied.
Such a “trick” may lead to arbitration. Tax authorities dispute the rate of 10 percent, insisting on 18. But the arbitration practice is often on the side of entrepreneurs, because according to GOST “Catering services. Terms and definitions ”, approved by order of the Gosstandart of Russia dated November 30, 2010, flour culinary products include pies, white meat, pizza. And these products contain various fillings.