Putin Eases Tax Burden for Russian Small Businesses

Facing a scheduled tax hike that threatened to squeeze smaller enterprises, Vladimir Putin signaled a policy reversal during the St. Petersburg International Economic Forum. The president proposed shielding businesses with annual revenues up to 20 million roubles from VAT obligations, effectively hitting the brakes on a planned fiscal tightening.

The proposed exemption offers a reprieve for the country’s small-scale entrepreneurs, who were bracing for a significant shift in tax policy. Under the government's previous roadmap, the threshold for VAT immunity was set to drop from the current 60 million roubles to 20 million by 2026, followed by further annual cuts to 15 million and then 10 million roubles by 2028. By locking the threshold at 20 million roubles indefinitely, the administration aims to stabilize the operating environment for these firms starting in 2025.