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

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

Taxes and tax reforms in Russia: the regulatory framework

The key provisions of the current program to collect mandatory payments to the budget were approved in late 1991. Then the main law regulating this sphere was adopted. In the normative act taxes, duties, fees and other deductions were established, subjects, their duties and rights were defined. In addition, other laws on specific taxes were enacted, which came into force in January 1992. The basic 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 when more than 20 regulatory acts were adopted. On November 21, 1992, under the 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. All-state. They were established at the federal level.
2. Local. They were determined by the territorial structures of power, according to the legislative acts of the subjects.
3. Republican fees, taxes of administrative and national-state entities. They were established by the decision of state bodies and laws of the respective regions.
4. Compulsory national and local fees and taxes.

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

First problems

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

Changes

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

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

Second phase

The new tax reform began in 1999. It was marked by the entry into force of the first part of the NK. It should be noted that the Code has been discussed for a long time. In the general part, the duties and rights of the subjects were established, the process of fulfilling the obligations to the budget was regulated, rules of control, 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. More than 40 normative documents have been developed and agreed to ensure the implementation of the legislation. The most important result of that period was the approval of the forms of declarations and instructions for their drafting. It should be noted, however, that while the document was passing through the Duma, it lost many innovative proposals. However, the mechanisms and rules were in fact far from flawless. In this regard, over the past few years, the NK has introduced many amendments.

Transformation 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 were developed for the medium term (until 2004). First of all it was supposed:

1. Reduction of the excessive burden on the subjects, as a result of which prerequisites for evasion from payment of mandatory amounts were formed.
2. Weakening fiscal control of the state in favor of the stimulating functions of the tax system.
3. Ensuring an even distribution of the burden on payers.
4. Reducing the number and changing the direction of the established tax incentives.

In the framework of intergovernmental fiscal relations, the government was guided by the redistribution of revenues in favor of the federal budget with respect to regional budgets.

Objectives of tax reform

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

Subsequent transformations

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

1. VAT.
2. Excises.
3. Personal Income Tax.
4. UST.

Subsequent tax reforms for 2005 assumed:

1. Reducing the burden on the FOT. 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. Changing the regime of charging VAT. It was envisaged that the rate would be reduced to 16%. In addition, the tax reforms envisaged a revision of the return of the collection to exporters. In addition, the possibility of providing payers with electronic invoices was actively discussed.
3. Change in property taxes. It was intended to replace the existing fees with royalties from real estate. This practice was, in particular, introduced in the Tver region.
4. Establishment of preferential treatment for enterprises operating within special economic territories. This was to ensure innovative and investment activities.

Processes of collection and control

Tax reforms are focused on flexibility and transparency, simplification and reduction of the volume of document circulation. Realization of the set tasks provides for reducing the load not only in the fiscal, but also in the administrative part. In particular, it is a question of reducing the payer's expenses for the implementation of legislation. As practice has shown, the reduction in the fiscal burden for some taxes passed together with a simultaneous increase in administrative pressure. In particular, the volume of financial reporting has grown, the account of the payer's activity has become more complicated, and the control of state bodies has increased. In this regard, steps have been taken to:

1. Change the structure of control organs.
2. Development of information technologies.
3. Improvement of management techniques.

Conclusion

The results of reforming the system of taxes and fees are generally assessed as positive. In the period from 2000 to 2003, The share of the load from GDP gradually decreased from 34% to 31%. As a result of the activities carried out, there has been a significant change in the structure of receipts. First of all, the share of allocations related to subsoil use increased significantly. At the same time, revenues from enterprises' profits decreased, while personal income tax increased almost 1.5 times. There is a high share of fees intended for social, medical and pensions. Their level is within 25%.