On July 9, 2024, members of the Spravedlivaya Rossiya – Za Pravdu (A Fair Russia – For Truth) political party filed a proposal in the State Duma to amend Russian Federal Law 183-FZ “On Citizenship” of 28 April 2023. The amendments would allow a discriminatory tax regime to be applied against any Russian citizen by birth who also has one or more additional citizenships (excluding South Ossetia or Abkhazia, whose sovereignty is officially recognized by Russia, as well as Belarus) or a foreign residency permit.

On July 12, 2024, the Russian President signed the first law passed by the Russian State Duma as part of the "fine tuning" of the tax system announced  earlier. We should note that this law introduces very significant changes not only in the tax laws, but also, speaking in simpler terms, in the usual way of life for Russians, because it will, without exaggeration, affect everyone.

Last week, the Russian Government submitted to the State Duma for consideration and subsequent adoption a draft law (hereinafter also the "amendments") proposing to substantially reform Russian tax laws starting January 1, 2025.

Taxpayers who missed the 2022-2023 deadline for processing transfers of assets from controlled foreign companies ("CFCs") have been in the waiting for many months for an extension of the benefits of tax-free transfer of assets from CFCs. And now, this week, the bill to extend and expand the exemption was approved by the Federation Council, which means that it will soon take effect and the process of voluntary deoffshorization will continue.

We would like to remind you that IT companies that wish to enjoy tax benefits need to confirm their state accreditation every year. Companies can confirm state accreditation on the Gosuslugi web site from May 8 to June 1 inclusive.

By May 20, 2024, taxpayers must submit a notification to the tax authority regarding controlled transactions (Clause 2 Article 105.16 of the Russian Tax Code). The key points regarding filing such a notification are described in our brief.

The media’s attention has long been drawn to issues of swapping assets blocked due to sanctions imposed by western states, as well as due to the counter-sanctions Russia imposed in response.

The end of the past year turned out to be a fruitful time for lawmakers, particularly in respect to taxation. To add, the majority of new laws took effect right as the celebrations unfolded, i.e. starting from January 1, 2024.

In this review, we will examine the main novelties in tax law which could have a meaningful impact on Russian business that has economic, corporate and other ties with foreign entities. That said, lawmakers were apparently guided by the principle of “leave no one behind” and addressed practically everyone, since the provisions we will examine here will affect not only persons with ties to so-called “unfriendly entities,” but also residents of other foreign states.

Since August of 2023, businesses have had to adapt to the fact that Russia has suspended double tax treaties with a number of foreign states. Although suspension of double tax treaties is not provided for by the international treaty itself, the suspension was ordered by a Decree of the Russian President (Presidential Decree No.585 dated August 8, 2023, hereinafter “Decree 585”), as we wrote earlier.

Presidential Decree No.665 dated September 9, 2023 (“Decree No.665”) was published recently and regulates the procedure which Russia will follow when performing its obligations under eurobonds (state bonds in foreign currency) to residents and to foreign creditors. The new decree modifies the procedure previously set by Presidential Decree No.394 dated June 22, 2022. In this overview, we will briefly analyze how Decree No.665 changed the process.