Bill to exempt Russian regional grants from income tax
A Bill to exempt recipients of regional grants from income tax has been adopted at first reading.
On 26 September, the State Duma adopted a Bill at first reading introduced by the Ministry of Economic Development which exempts those in receipt of grants from regional and local budgets from paying personal income tax. Appropriate amendments will be made to the Federal Tax Code.
Receiving subsidies or grants is currently regarded as personal income which means paying 13% tax on them. “As a rule, these grants are awarded to support the educational, scientific and cultural development of civil society and other important social areas. Therefore, allowing people not to pay tax on these grants will allow more money to be set aside for the implementation of projects in these areas”, said Tatyana Ilyushnikova, Deputy Minister of Economic Development.
The Bill states that tax relief will be available to those who take part in competitions for cash or in-kind, as well as payment to cover travel costs to and from competition venues, “other events”, meals and providing premises for temporary use funded by regional and local budgets.
The list of events, the winners of which will not have to pay personal income tax, will be approved by the head of the regional or local authority.
The conclusion of the State Duma Committee on Youth Policy notes that the adoption of this federal law will have a positive economic, budgetary and social impact.