Excise, transport and personal property tax rates and state duties have been revised

29.01.2010

Legal Update No. 117

Goltsblat BLP advises that the following laws have been adopted:

  • Federal Law No. 282-FZ of 28 November 2009 “On amendments to chapters 22 and 28, part two of the Tax Code of the Russian Federation” (the Federal Law on Excise and Transport Tax);
  • Federal Law No. 283-FZ of 28 November 2009 “On amendments to individual legislative acts of the Russian Federation” (the Federal Law on Personal Property Tax); and
  • Federal Law No. 374-FZ of 27 December 2009 “On amendments to article 45, part one and chapter 25.3, part two of the Tax Code of the Russian Federation and individual legislative acts of the Russian Federation and on invalidation of…” (the Federal Law on State Duty).

All these Federal Laws (apart from certain provisions) took effect in January 2010 and have the following tax meaning.

The Federal Law on Excise raised excise duty rates for alcoholic products with ethanol concentration of under 9 per cent, for tobacco, cigars and cigarillos.

Fixed portion of excise duties for cigars has also been revised. The law also escalated excise duties payable for engine oils and motor petrol, excise rates for beer with alcohol concentration of 0.5 through 8.6 percent were raised nearly threefold.

The procedure for paying excise has also been revised - the duty is to be paid in full upon sale (transfer) of produced excisable goods, by the 25th day of the month following the relevant closed tax period.

In accordance with the Federal Law on Transport Tax, the tax rates may be raised (reduced) by virtue of laws adopted by constituent entities of the Russian Federation, but no more than ten-fold. Previously, the tax rates could vary by up to 500 per cent.

The law also introduced a possibility to differentiate between tax rates depending on the emission class of the vehicle. Useful life has been replaced by the number of years since the vehicle’s year of manufacture as a criterion for differentiating between the applicable rates.

Pursuant to the Federal Law on Personal Property Tax, the tax rates are to be established by local government authorities depending on the aggregate inventory value of the relevant property and may fluctuate within the established limitations depending on the value and use of the property.

A share in common ownership of a dwelling house, apartment, room, dacha, garage or other building, premises or structure is now recognised as an individual taxable item.

The law established that tax on property in shared ownership shall be paid by each owner in proportion to its respective share, while tax on property in joint ownership (where the shares have not been apportioned) shall be paid by each owner with respect of the share of property proportionate to the number of owners. The provision on agreed payment of tax by one of the co-owners has been removed.

The law also specifies that taxes paid by individuals on the basis of tax notices may only be re-calculated for up to three years preceding the calendar year in which the notice is sent.

The Federal Law on State Duty revised the amount of specific state duties, for instance state duty payable for legal cases considered by state arbitration courts has been raised while state duty payable by legal entities for lawsuits for invalidation of regulatory acts and ad hoc regulations of government authorities and officers remains unchanged.

State duty payable for lawsuits considered in general jurisdiction courts and by JPs have increased. The law also cancelled state duty for filing all and any supervisory appeals; previously, the duty was not payable for cases challenged as part of an appeal procedure. State duty payable for other legally significant acts has also been raised.

Issue of document copies has been removed from the list of legally significant acts requiring state duty payment. Only issue and re-issue of documents is now recognised as a legally significant act.

State duty is not payable for remediation of any errors in documents made by the issuing authority or officer. Even so, this provision will not be effective until one year after the official publication of this Federal Law.

For additional information, please contact:

Andrey Shpak
Partner
Tax Consulting/Tax Litigation Goltsblat BLP
E: info@gblplaw.com

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