Bloggers-relocators were going to impose an increased tax: the goal of the initiative of the Ministry of Finance was named

It is related to the determination of the status of residence

The activities of Russian bloggers working abroad and posting content on YouTube and similar foreign platforms will be subject to income tax at a rate of 30%. In the opinion of experts, in this way the Ministry of Finance solves the problem not so much of a fiscal, as of a regulatory and legal nature. It is connected with the status of tax residency and the need to streamline this status as much as possible.

The initiative regarding bloggers complements the package of amendments to Article 208 of the Tax Code, prepared by the financial department and submitted to the State Duma on April 24 (it was withdrawn by the Ministry of Finance a day later for clarification). The document proposes to determine the conditions under which income from the activities of Russians abroad is subject to taxation in the Russian Federation. According to it, if Russian domains, network addresses or servers are used in the performance of work, then income will be subject to personal income tax in Russia (that is, it will be considered from the source of the Russian Federation).

Now, if, for example, a programmer fulfills an order for a Russian company from abroad, he does not pay tax at all, since income is not considered received from activities in the Russian Federation. This gap in the legislation is planned to be closed, that is, the domestic segment of the Internet will be equated to the territory of Russia (in terms of income). The Russian tax legislation will also cover those bloggers-relocators who post content on foreign sites, but receive financial rewards from the Russian Federation. The measure was discussed back in March 2021: at that time, the platforms themselves were supposed to become tax agents, primarily YouTube video hosting and the Instagram social network (banned in Russia; owned by Meta, which is recognized as extremist and banned in the Russian Federation). As noted by the Ministry of Digital Development, advertising money usually goes to the personal account of bloggers, and this is not formalized in any way.

There are more than a million Russian bloggers, of which only about a thousand have over a million subscribers. The monthly ruble earnings of the most popular reach six figures and more, and depend mainly on the number of views and advertising. More precisely, this was the case until March 2022, when YouTube completely suspended all monetization functions for authors of Russian videos, including Premium subscription, sponsorship, super chat and a number of others. Today it is impossible to name the exact amount of earnings of a blogger.

“In my opinion, the Ministry of Finance’s initiative is justified,” says Polina Gusyatnikova, Senior Managing Partner at PG Partners. – If a blogger earns from a Russian audience, then such income can be considered received in the Russian Federation, and the tax from it should go to the Russian budget. At the same time, it does not matter in which country a person is physically located, and which particular platform he uses. The goal is clear and obvious – to increase the collection of taxes, in conditions when the treasury is in dire need of funds. The prospects for the measure proposed by the Ministry of Finance are quite high: for many bloggers, this will be a sign that it is easier to pay taxes than to look for options to avoid them.”

The essence of this rather flexible project is to determine the status of tax residency, to eliminate its legal vagueness, says Nikita Maslennikov, a leading expert at the Center for Political Technologies. At the moment, the income of persons who have stayed abroad for more than 183 days a year and have lost the status of a Russian resident is not taxed at 30%. The Ministry of Finance proposed to change the situation, including in relation to bloggers. Moreover, several hundred thousand citizens left the country last year and it is not yet clear whether they will return or not. At the same time, the measure will not affect remote workers (regardless of their place of residence) with whom companies in the Russian Federation have employment contracts. Resident personal income tax of 13-15% will continue to be charged from their income. “There is nothing draconian in the project, it did not become a bolt from the blue, as it was discussed since the spring of last year,” says Maslennikov, “By implementing it, the Ministry of Finance solves the problem not so much of a fiscal nature as of administration.”