Last week, the Kremlin rolled out the message: “VAT saves the budget — everyone must become a savior.” By making the easiest tax to collect the main revenue source — raising value-added tax from 20% to 22% — officials acknowledged what many already suspected: with the civilian economy shrinking while the military eats an ever-larger share of spending, the state may no longer be able to raise what it needs without squeezing small businesses. Every day brought new rules about who will now pay VAT after previously being spared: companies on the simplified tax regime with annual income above 10 million rubles (about $123,000); anyone selling imported goods on marketplaces; self-employed people with income above 10 million ruble
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