Russian Deputy Finance Minister Sergey Shatalov
Photo: Ilya Pitalev
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Finance Min. Axes Olympic Tax Breaks
The Russian State Duma will consider the first reading of an amendment on preparations for the 2014 Olympics. Besides establishing the controversial rules for property seizure in Sochi, the amendment contains a list of tax benefits to be added to the Tax Code. Deputy Minister of Economic Development and Trade Sergey Shatalov announced yesterday that those tax benefits would not include the lifting of VAT from the organizing committee or of customs duties for Olympic supplies.
The text being seen today differs significantly from the version introduced by United Russia Party MPs last month. At that time, it was proposed that the organizing committee, the International Olympic Committee and organizations affiliated with be freed from VAT on operations within the country, and from the profit tax, property tax and tax on means of transportation. The Olimpstroi state corporation was exempted from the taxes on profit, property and land. Companies importing goods into the country for use during the Olympics (with the exception of those subject to excise) were to be exempted from VAT at the time of import and from customs duties.
The government found those tax breaks excessive. Exemptions for suppliers from customs duties and VAT disappeared, as did the organizing committee's exemption from domestic VAT and Olimpstroi's exemption from the land tax. Ilya Trunin, head of the Finance Ministry department of tax and tariff policy stated that the tax benefits described in international obligations are sufficient for all. Therefore, the ministry will continue to press for the reduction of the list of Olympic tax breaks.
www.kommersant.com
All the Article in Russian as of Oct. 16, 2007
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