30% of Russian IT companies may reduce investments in product development and promotion by 10% due to the increase in income tax. Russoft analysts came to this conclusion during the study and Vedomosti reviewed the results.
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The zero income tax rate for IT companies, introduced in 2022, will be in effect until the end of 2024. From 2025, the tax rate is set at 5%.
The Russoft survey was conducted in March, when authorities had not yet made a final decision on extending IT benefits. Therefore, the company’s specialists also considered the option of returning to the 20% income tax rate. Such a rate would lead to a reduction in development investment of 25%, the study notes.
According to them, the abolition of zero rate will reduce not so much the income of software entrepreneurs as investments in the development of important software for the country and its promotion in foreign markets.
On average, IT companies reinvest between 50 and 100% of their profits, said Roman Margulis, managing partner and head of the tax practice at ASB Consulting Group. The money is often used to improve products and pay salaries, which have increased significantly in recent years.
Managers from more than 300 Russian IT companies participated in the study.
Author:
Karina Pardaeva
Source: RB
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