Study on the effects of the special tax regimes for small and medium-sized enterprises in the Russian Federation

Исследование эффектов от применения специальных налоговых режимов и преференций для субъектов малого и среднего предпринимательства в Российской Федерации

Belev, Sergei (Белев, Сергей) (), Vekerle, Konstantin (Векерле, Константин) (), Leonov, Elisey (Леонов, Елисей) () and Matveev, Evgeniy (Матвеев, Евгений) ()
Additional contact information
Belev, Sergei (Белев, Сергей): The Russian Presidential Academy of National Economy and Public Administration
Vekerle, Konstantin (Векерле, Константин): The Russian Presidential Academy of National Economy and Public Administration
Leonov, Elisey (Леонов, Елисей): The Russian Presidential Academy of National Economy and Public Administration
Matveev, Evgeniy (Матвеев, Евгений): The Russian Presidential Academy of National Economy and Public Administration

Working Papers from Russian Presidential Academy of National Economy and Public Administration

Abstract: The development of small and medium-sized enterprises is one of the priorities in state policy. At the same time, crucial factor of small business activity is taxation. The need for a special approach to taxation of small enterprises in comparison with large ones is linked to the greater significance of fixed costs of compliance with tax legislation and a wide choice of formal and informal forms of business organization. The purpose of the study is to systematize modern theoretical and practical approaches to the taxation of small businesses and to assess the effects associated with special taxation regimes. A review of international experience in supporting small and medium-sized enterprises showed the following. Various forms of support are actively used in both developed and developing countries. At the same time, the set of support tools differs and depends on - the historically developed characteristics of SMEs, aspects of the development of the region, as well as the financial capabilities of the country. Distributional analysis an regression approach have revealed that the simplified taxation system in the Russian Federation creates so called "growth tax" for small and medium-sized enterprises, since there is a progressive scale of taxation with a gap, both in consumption (due to VAT exemption for taxpayers under the USN) and in profit of organizations (due to lower tax rates and the threshold for switching to the general taxation system). Raising the threshold more than twice in 2017 led to shifting poor incentives for revenue growth to a smaller number of larger companies. This doubled the losses in terms of percentage revenue growth of companies from 29 regions of the Russian Federation and increased total revenue losses from 2 billion rubles in 2015-2016 to 3 billion rubles in 2017-2018.

Keywords: SMEs; tax deductions; firm size; targeted tax policy; distributional analysis; special tax regimes; encouraging innovation; public procurement (search for similar items in EconPapers)
JEL-codes: E62 H21 H32 K34 (search for similar items in EconPapers)
Pages: 40 pages
Date: 2023
References: Add references at CitEc
Citations:

Downloads: (external link)
https://repec.ranepa.ru/rnp/wpaper/w202360.pdf

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:rnp:wpaper:w202360

Access Statistics for this paper

More papers in Working Papers from Russian Presidential Academy of National Economy and Public Administration Contact information at EDIRC.
Bibliographic data for series maintained by RANEPA maintainer ().