Bashkiria expanded tax incentives for PDA residents

The amendments increase the application of the reduced income tax rate.

The corresponding law was adopted in the first reading by the deputies of the State Assembly - Kurultay RB.

"The amendments propose to apply benefits to the entire tax base of enterprises. Residents will be able to take advantage of the support measure, which income from activities carried out within the agreements on the PDA activities is at least 90% of all profits. At the same time, they must keep separate records of income received under the said agreement and the rest," Ayrat Fakhretdinov, Deputy Minister of Economic Development and Investment Policy of the Republic of Bashkortostan commented.

There are six monocities in Bashkiria. As of January 1, 2021, more than 400 thousand people lived in them - almost 10% of the republic's total population. These are Belebey, Kumertau, Neftekamsk, Beloretsk, Blagoveshchensk and Uchaly. In the first five cities, priority development areas (PDAs) have been created.

Profit tax incentives are available for for enterprises - PDA residents: federal taxes are completely zeroed out, regional taxes are charged at a rate of 5% for the first five years and 10% for the next five years. There is a reduced coefficient in the application of the mineral extraction tax.

The tariffs for insurance payments are also reduced (from 30% to 7.6%) for residents who received this status within the first 3 years from the date of the PDA creation.

At the regional level, PDA residents are exempted from paying property tax; at the municipal level - from land tax.