VAT accounts for about 34% of Russian budget revenues

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The President of Russia Vladimir Putin on 3 August signed a law raising the value added tax (VAT) to 20% from the current 18%, according to the official portal of legal information of the Russian Federation.

The document also specifies new rates of social security contributions.

The law will come into force on 1 January 2019.

The Russian government has announced plans to raise the VAT 14 Jul 2018. It is the largest Federal tax of the Russian Federation, it accounts for about 34% of budget revenues, said “Russian service of BBC”.

In March 2017 the Ministry of Finance also announced its intention to reduce contributions to social funds and to increase the VAT rate.