Transport Ministry Proposes Lower Taxes to Support Industry

The Ministry of Transport has submitted proposals to the government on new measures to support the industry. These included a reduction in the tax burden and investment access to credit. The support itself will now extend to freight vehicles, urban electric vehicles, train stations, and bus stations, Kommersant reported.

The document is an addition to the first package of measures to support the transport industry. The ministry proposes to exempt from the utilization fee of international road carriers who purchased buses and Euro-6 trucks that are not produced in Russia.

The ministry also proposed to subsidize interest on leasing and loans to owners of passenger buses and to cover 80% of the cost of tachographs for them by reducing the number of insurance premiums to the Social Insurance Fund. Among the proposed measures is a zero rate of value-added tax for domestic and international road transport, which are committed in Russia.

Regions are recommended to abolish land, property and transport taxes in 2020, and also not to lease rent from owners of bus stations, bus stations, trucks, buses and city electric vehicles. The Ministry of Transport intends to remove the 50% limit for deduction of loss from deferred tax for auto and air transportation, electric transport, metro and train stations and reduce the rate of insurance premiums by up to 15% of the wage fund for 2020–2022.

For air travel, it is proposed to nullify VAT on all domestic flights until 2030 from April 1. It is proposed to reduce insurance premiums for the aircraft crew wage fund from 22% to 10% for compulsory pension insurance, from 5.1% to 2% for compulsory health insurance, from 2.9% to 2% for sick pay and maternity leave. The general rate of insurance premiums for airports is to be reduced from 30% to 7.6% in 2020–2022.

The Ministry of Transport is ready to establish a profit tax benefit in the number of investments in the reconstruction and construction of airports, in the Far East – 100% to finance facilities at the expense of VEB.

The ministry also proposed to abolish the transport tax for leasing companies, thereby reducing the size of leasing payments, property tax – for aircraft from the Russian registry. The Bank of Russia was asked to minimize reserve requirements and provision of loans for airlines and airports.

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