Since 2022, Russia has stayed away from integrating Pillar 2 rules or their analogues into its legislative framework.
Meanwhile, many countries have already enforced Pillar 2.
For MNE groups with a presence in Russia and a low effective rate (e.g., due to the use of exemptions), this poses the risk of additional foreign taxes.
Earlier this year, the Russian Ministry of Finance made it clear that it would not allow taxes from the Russian perimeter to be paid in foreign jurisdictions.
This can be avoided by “bringing” the Russian income tax to 15%, where the effective rate is lower.
Relevant draft tax amendments to the Russian Tax Code have already been posted on the Federal Portal of Draft Regulations.
Read on for a detailed overview of the proposed changes.
Meanwhile, many countries have already enforced Pillar 2.
For MNE groups with a presence in Russia and a low effective rate (e.g., due to the use of exemptions), this poses the risk of additional foreign taxes.
Earlier this year, the Russian Ministry of Finance made it clear that it would not allow taxes from the Russian perimeter to be paid in foreign jurisdictions.
This can be avoided by “bringing” the Russian income tax to 15%, where the effective rate is lower.
Relevant draft tax amendments to the Russian Tax Code have already been posted on the Federal Portal of Draft Regulations.
Read on for a detailed overview of the proposed changes.