Russian President Vladimir Putin, left, and Finance Minister Alexei Kudrin, right
Photo: Ilya Pitalev
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Putin Ordered to Trim VAT
At the recent meeting of Security Council, Russia’s President Vladimir Putin promised to business to introduce “a uniform and maximally low rate of VAT.” According to President’s Expert Department chief Arkady Dvorkovich, the matter at stake is unifying the rate at 12 percent to 13 percent instead of today’s 10 percent (the preferential rate) and 18 percent (the basic rate).
“I will say more when addressing the government, Federal Assembly members. We should, among other things, strive for establishing a uniform and maximally low rate of VAT,” the president said Friday during the extended meeting of the State Council.
The most probable scenario is trimming the rate to from 12 percent to 13 percent, explained Arkady Dvorkovich, who is the chief of the president’s experts. They are deliberating on fixing the rate at from 10 percent to 16 percent, Dvorkovich said, adding that reducing it to 10 percent “entails an excessive risk for the budget,” while lowering it to between 14 percent and 16 percent makes no sense as it won’t change today’s nature of VAT.”
The response of officials to the VAT promise of president was different. State Duma Speaker Boris Gryzlov immediately announced that the legislature is deliberating on the 12-percent VAT. Contrary to Gryzlov, Finance Minister Alexei Kudrin doesn’t appear particularly eager to execute the president’s order. “Reduction will certainly happen till 2020, but speaking about some definite dates would be too early,” the minister explained.
www.kommersant.com
All the Article in Russian as of Feb. 11, 2008
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