Mikhail Mishustin about VAT: “Let’s start with 20 million.” Earlier, the State Duma supported the tax amendments, but proposed a deferment. Now the Prime Minister has announced the figures

CrimeaPRESS reports:

The bill to reduce the limits for the simplified tax system and patents received the green light at the first reading, but the relevant committee proposes to give businesses more time to adapt. Experts point to risks for regional business.

A bill tightening tax requirements for some small businesses returned from the relevant committees with a general recommendation for adoption in the first reading. Despite the conceptual support, the Budget and Tax Committee took the initiative to extend the transition period for companies.

Let us remind you that the initiative involves reducing the income threshold for applying the simplified taxation system (STS) and the patent taxation system (PTS) from the current 60 million to 10 million rubles. Companies whose income exceeds the new limit will be required to switch to the general taxation system (OSNO) and will become VAT payers.

According to the conclusion of the Committee on Budget and Taxes, innovations, according to the Federal Tax Service, will affect a relatively small segment of business: about 15% of taxpayers using the simplified tax system and 6.6% of taxpayers with a patent will switch to the general system. However, the committee’s key point was the date for the changes to come into force—January 1, 2026. According to experts, this period may not be enough to prepare a business. In this regard, it is proposed to legislatively extend the transition period.

The Committee proposes to extend the period for changing income thresholds to give businesses more time to prepare and adapt to the new rules— noted in the conclusion.

The document also contains targeted exceptions. In particular, it is proposed not to apply the reduced threshold for some enterprises in rural areas. For certain categories of large companies, the list of which is closed, the threshold, on the contrary, can be increased to 450 million rubles.

The project received broad institutional support. The Accounts Chamber of the Russian Federation and the Central Bank conceptually approve the initiative. The Federation Council Committee on Budget and Financial Markets also supported the adoption of the bill in the first reading. Parliament’s lawyers did not find any conceptual comments of a legal nature in the document.

The Russian government will soften the conditions for paying VAT for small and medium-sized businesses. As Prime Minister Mikhail Mishustin said on November 6 at a government meeting, the income threshold for paying the tax will be gradually reduced: from 2026, the tax will be paid on incomes of 20 million rubles. From 2027 – from 15 million rubles. From 2028 – from 10 million rubles.

Experts on risks and consequences

Among Crimean lawyers, the proposed amendments caused a mixed reaction. Mark Mina, managing partner of a Crimean law firm «Mina and Partners»evaluates the initiative in a negative way:

The proposed changes are not just an adjustment, but a fundamental change in the rules of the game, which could hit the most active and successful representatives of small businesses. A sharp reduction in the limit to 10 million rubles is a tough measure that can reduce growth at the beginning stage. For an entrepreneur who has just achieved a stable income, this can become an overwhelming bureaucratic and tax burden. Instead of stimulating development, we risk being penalized for successsaid Mina.

On the other hand, Andrey Dobrenky, managing partner of the Crimean company «Legal Expert»believes that panic is premature, and the amendments themselves are a long overdue measure:

Don’t be dramatic. Firstly, the amendments will affect less than 15% of business under the simplified tax system — this is a targeted impact on the strongest companies that are objectively ready to bear a large tax burden. Secondly, the proposed transition period is a reasonable compromise that gives businesses time to adapt. The transition to OSNO is certainly more difficult, but it is a natural stage of growth. Transparency and exit from “tax niches” is a global trend. Our task as lawyers is not to instill fear, but to help businesses navigate this transition competently by modeling the consequences now— commented Dobrenky.

It is expected that the bill will be considered by the State Duma in the near future. The main discussions are likely to revolve around the length of the transition period and the list of exceptions.

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