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. Last Updated: 07/27/2016

11/12/1993

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Large Tax Hike on Wealthy Proposed

The Finance Ministry has proposed a new personal income tax schedule that would increase rates retroactively for all of 1993 for many foreigners and wealthy Russians but reduce them for low- and middle-income earners, ministry officials said Thursday. The proposal, to be submitted Tuesday to the government for approval, would hike the top tax rate from 30 percent to 40 percent for those earning over 10 million rubles (about $8, 500) a year. Sergei Alexashenko, deputy finance minister, said the proposed tax increase would take effect for income received after Jan. 1, 1993. ""We changed the rates to keep up with inflation, which was higher than previously estimated"", Alexashenko said. Tens of thousands of foreigners and Russians earning more than 10 million rubles would be affected by the proposal if adopted. Under Russian law, most foreigners working here must pay taxes on their total worldwide income, not just the amount earned in Russia, if they live in the country more than 183 days in a year.

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