Senators approved the elimination of the CTG 2023

© RIA Novosti / Vladimir Fedorenkova in photobacteria of the Federation Council of the Russian Federation. Archival photoSenators approved the elimination of the CTG 2023© RIA Novosti / Vladimir Fedorenkova the image Bank

The Federation Council at the meeting on Saturday approved a law providing for gradual abolition of transfer pricing control to transactions within the country and in this regard, the elimination of 2023 the institution of consolidated groups of taxpayers (CTG).

Introduced a permanent ban on registration in tax bodies of the treaties establishing the CTG and changes to the agreements providing for the accession of new members of such groups. Determined the maximum expiration date of the treaties establishing the CTG no later than 1 January 2023.

The threshold at which monitoring to be transactions between related parties inside Russia, remains at the level of 1 billion rubles per year. For cross-border transactions, this threshold is set at 60 million rubles a year. Now every external transaction needs to be agreed. As currently the threshold for cross-border transactions is not selected, the controlled discharge is subject to any foreign trade transaction (except for transactions with offshore residents).

This set of solutions allows, on the one hand, to abandon the highly criticized from the regions of the Institute the CTG and on the other, to concentrate the control over transfer prices only in those areas where there is a real risk of tax evasion, explained earlier, Deputy Minister of Finance of the Russian Federation Ilya Trunin.

In order to minimize such risk areas of the law, he said, eliminate within five years the right of subjects of the Russian Federation to set reduced tax rates on profits. However, this prohibition does not apply to residents of special economic zones, priority development areas and participants of regional investment projects.

Reduced rates of profit tax established by laws of constituent entities of the Russian Federation until January 1, 2018, taxpayers will be able to apply until the expiration of their validity, but not later than January 1, 2022. However, such reduced rates may be increased by regional laws in fiscal years 2019-2021 years.