More than half of companies will stop working with freelancers abroad if Russia raises taxes: survey

The study showed that 42% of companies cooperate with at least one freelancer or individual entrepreneur who is permanently located outside of Russia. At the same time, 55% of managers indicate that they are not willing to pay more taxes and contributions to retain specialists who have gone abroad.

Context:

• In 2022, the Ministry of Finance proposed to tax the IRPF of 30% on the quotas of the self-employed who left.
• The version of the bill submitted for public discussion stated that Russian employers would withhold 13-15% of personal income tax, depending on the amount of salary income from “remote” employees, while they are residents of the Russian Federation. (they are in Russia for more than 183 days a year), and after the loss of their residence – 30%.
• As of February 2023, the discussion on income tax rules has not ended, no decisions have been made.

Among relocators, IT reps are seen most often: 28%, Marketing: 24%, Sales: 23%, and Writing: 16%. Less of all specialists permanently living abroad are in design – 2%, medicine – 7%, and insurance services – 9%.

Most companies (72%) will be able to find a replacement for departed freelancers if it is no longer profitable for the organization. 18% of companies said they can easily find a replacement for referred specialists.

54% of entrepreneurs see difficulties in finding new specialists, but do not consider this task impossible. 20% of those surveyed believe that replacing the current self-employed can greatly harm the business. Only 9% said it was impossible to replace freelancers who left.

The most difficult thing for a company will be to find a replacement in IT; this was reported by 28%. One in four (25%) will struggle to find a sales specialist, one in five when looking for a finance specialist. Another 16% will have difficulty finding employees in the marketing field.