Russia’s State Duma has approved a tax reform bill in the first reading, proposing a unified progressive personal income tax scale of 13% to 22%, 22% corporate income tax for personal foundations, and 22% VAT on e-commerce goods purchased from third countries.
Russia’s State Duma adopted a bill amending the Tax Code in the first reading on 29 October 2026. The bill sets out the main directions of tax policy for the next three years.
Alexey Sazanov, state secretary and deputy minister of finance, presented it at a plenary session. He said it seeks to ensure “equality and fairness in taxation” and the stability of the budget system.
Simpler administration
The bill aims to reduce the administrative burden and simplify interaction with tax authorities. Under a presidential instruction, information exchange between tax authorities and the Social Fund will be expanded. Individuals will then receive property tax benefits automatically, without submitting applications. Rules will also be set for information exchange between online trading organisations and tax authorities.
Benefits and deductions
Tax relief for families with children who sell residential property to improve their housing conditions will cover house construction as well as purchase. A social tax deduction will become available for medical devices used in surgical procedures. Reduced VAT rates for air transport will be extended. These include a zero rate for services in the Far Eastern Federal District, Crimea and Sevastopol, and a 10% rate for the Moscow aviation hub.
For companies, a special procedure will govern the recognition of expenses incurred to protect production facilities and the population against external threats. Credit institutions will become tax agents for personal income tax on interest paid to individuals on bank deposits. Excise duty rates and penalties for tax offences will be indexed to reflect accumulated and projected inflation.
Excise duties
To reduce the risk of surrogate alcohol production, the bill proposes abolishing special excise duty conditions for manufacturers of medicines and medical devices that use less than 500,000 litres of ethyl alcohol annually. Under a presidential instruction, nicotine-free liquid used in electronic nicotine delivery systems will become an excisable product.
Personal and corporate income tax
A unified progressive personal income tax scale of 13% to 22% will apply to all major types of individual income, including passive income. The aim is to tax income equally regardless of its source. The corporate income tax rate for personal foundations will rise from 15% to 22%.
Closed-end and interval mutual investment funds intended for qualified investors will pay corporate income tax at 15% on certain types of passive income. Sazanov said this will not increase the overall tax burden, as the tax paid will be credited when distributions are made to unit holders.
VAT on e-commerce
VAT at 22% will apply to e-commerce goods that individuals purchase from third countries through online marketplaces. The measure is intended to create equal competitive conditions regardless of the sales channel.
Windfall tax on extractive companies
The Duma also adopted in the first reading a separate bill on the taxation of natural resource rents. It proposes a windfall tax on extractive companies, so that income generated solely by favourable commodity market conditions is shared fairly with the state.
Windfall profits will be determined by how far the average ruble price of a mineral on the global market during 2026–2028 exceeds its 2025 average, taking into account applicable coefficients. The tax will apply only if the average price rises by at least 10%. No tax will be imposed on new mineral deposits where extraction did not take place in 2025.
Sazanov said the proposed rate would be 30% for minerals and 20% for gold. The tax amount will be capped at the difference between 15% of the calculated revenue from mineral sales and the amount of mineral extraction tax.
