Changes to Tax Code concerning alcohol trade increase competition between small and large businesses

19.02.2016
The Ministry of Industry and Trade took up elaboration of draft amendments to the tax Code of Russia that will change the procedure of obtaining license for retail trade of alcohol. It concerns a differentiated rate of state duty: it will depend on the number and location of trade outlets.

Lawyer of tax and customs law practice of YUST Law Firm Nikita Tolkachev mentioned that a differentiated rate of state duty will have a positive effect on business. In particular, the new procedure of determining the amount of duty will comply more with the principle of taxation set out in paragraph 3, article 3 of the Tax Code: “taxes and duties shall have an economic ground and may not be arbitrary”. “Currently the amount of duties for major retail chains is insignificant, given their turnover and profits”, the expert underlined. “Meanwhile, equivalent license costs may be significant for small businesses, which certainly has a negative effect on competition”.

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