Tourist associations asked the government to reduce the tax burden

Four major business associations in the Russian tourism industry sent a letter to the Ministry of Economy with a request to lower rates on five tax items. The newspaper reports Vedomosti with a link to the document.

The authors of the letter are the Federation of Restaurateurs and Hoteliers, the Russian Hotel Association, the Union of Tourism and Hospitality, the Russian Union of Tourist Industry. Their letter refers to five taxes: VAT, property and income taxes, insurance premiums and the rate for simplified tax users.

Now the zero VAT rate applies only to revenue. The authors of the letter propose to exempt all services for participants of the tourist market from VAT. The marginal property tax rate is proposed to be reduced from 2.20% to 0.25% of the cadastral value per room area multiplied by 2. All infrastructure that is outside this doubled area is exempt from property tax, the letter says.

As for income tax, it is proposed to exempt hotels and other accommodation facilities from it, and reduce the insurance premium rate for their employees to at least the same level that is provided for IT companies – 7.6%. The authors of the letter believe that such innovations will increase the profitability of the market by 5-6 percentage points.

The Ministry of Economy told Vedomosti that they had received the letter, but did not comment on it. The office of Deputy Prime Minister Dmitry Chernyshenko, who oversees the tourism industry in the government, said that now the Ministry of Economy and the tourism industry are holding strategic sessions to develop a new model for managing the industry. The results were promised to be announced after the final meetings.

Read more about the risks of the tourism industry – in the material “Kommersant” “The flow of a limited budget”.