Russia has proposed amendments to the Tax Code of the Russian Federation that would allow regional authorities to introduce a social tax deduction for eligible young specialists under 35, with each region deciding whether and how to implement the measure.
A draft law has been submitted to the Russian State Duma proposing the introduction of a new individual income tax deduction for young professionals working in certain fields. The proposal is set out in Draft Law No. 1292383-8, submitted on 17 July 2026.
The bill would apply to professionals under the age of 35 who meet specified eligibility criteria. These include individuals with secondary or vocational education in the fields of medicine or education who are working in their specialty, employees of culture and arts institutions, and scientific and pedagogical workers engaged in educational or research activities.
Regional implementation
Under the proposal, each regional government would decide whether to introduce the tax deduction based on its financial capacity and local labour market needs.
Regions adopting the measure would determine the total size of the deduction, define the list of eligible professions, and establish any additional conditions, such as minimum length of service or residency requirements.
Aim to address labour shortages
The bill is intended to help address shortages of qualified personnel in key sectors by encouraging young professionals to remain in their occupations.
The proposal cites projections that Russian schools could face a shortage of more than 250,000 teachers by 2030, with a significant share of the current workforce nearing retirement. In healthcare, it reports a deficit of about 26,500 doctors and 58,000 nursing staff, while noting that 43 regions have recorded more medical workers leaving than joining.
The bill suggests that low and unfair wages are the main cause of these shortages, and the proposed social tax deduction is intended to help attract and retain young specialists in these fields.
Financial implications
The proposal states that it would not require expenditure from the federal budget. Any reduction in regional or local tax revenue would depend on whether individual regions choose to implement the deduction, as the measure would remain optional.
Government assessment
The Government of the Russian Federation issued a critical assessment of the proposal.
It said existing social tax deductions are linked to specific documented expenses, such as medical treatment or tuition, whereas the bill does not specify which actual expenses would qualify for the proposed deduction.
The government also argued that the proposal would shift the financial burden to regional and local budgets without identifying sources to compensate for lost revenue.
In addition, it noted that regions already have the authority to provide social support to young specialists and that such regional support is already exempt from personal income tax (NDFL) under Article 217 of current federal law.
