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As the price of oil has recovered, the economic outlook in Russia has also brightened. However, recent volatility in the Russian stock market and in the ruble exchange rate, both tied to fluctuations in oil, have kept the experts guessing as to where the economy will go next.
At Alinga, we've always held to conservative business and forecasting practices. As such, this quarter's Analytical Market Update explores ways that small and medium sized businesses can better control costs – especially those related to accounting and taxation. Those articles below indicated in red are our original articles that mostly focus on this issue. Those in blue are the news articles we regularly feature in our monthly Market Update.
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Writing Off Bad Debt
This article will lay out the circumstances under which debt can be written off in the Russian Federation and provide practical advice for those attempting to do so.
Old Meets New
Chinese companies are blending some of their traditional techniques with some new ones from the West to achieve good working management accounting practices they can use.
Non-salary payments to employees remain in question.
Expenses On Merchandising Are Economically Sound
Expenses for carrying out merchandising activity aimed at receiving income are economically sound and targeted at procuring a positive economic impact.
Recognizing Additional Expenses Of Prolonged Business Trips
Accounting for the additional expenditures (per diem, lodging) is only possible if the employee is detained solely for work purposes.
Benefits Will Take On A New Look
In 2010, the Unified Social Tax (UST), which is paid by employers directly from their payroll, will be replaced by payments to the federal insurance funds.
Notify Your Accountants!
There is much more "Accounting and Payroll" information available in the Russian version of this same newsletter!
Review Of Recent Changes To Tax-Related Legislation In The Russian Federation
This monthly Russian-language service from Alinga and regular feature of the Alinga Market Update is designed to bring your financial personnel a broad view of recent changes to the Russian Tax Code. Forward this link to them!
Russia's Simplified Taxation: The Basics of the System
With the current market realities, companies are striving more than ever to cut costs, including taxes. One possible method of tax reduction in Russia is to switch to the simplified tax system. At first, this may seem simple enough. However, in reality USN has shortcomings that can actually increase, not decrease, expenses.
Simplified Tax System Available For Organizations Founded By Foreigners
Organizations founded by foreigners are absent from the long list of organizations not specifically unable to apply for simplified taxation.
Three-Year Plan Outlines Tax Reforms Through 2012
On Wednesday, the Ministry of Finance published its three-year tax strategy on its website. Restricting opportunities to minimize taxes is one of the top priorities of the new Russian Tax Policy of 2010-2012. With this goal in mind, a number of changes regarding tax legislation and collection have been proposed.
No Tax On Airfare Purchased Through Foreign Organizations
When a Russian organization needs to purchase airline tickets, it may do so itself or through an intermediary foreign organization.
Unified Tax Package For Russians
Head of the Federal Tax Service has proposed new methods for collecting taxes from individuals.
For First Time In Four Years, Tax Debt Increases
The FNS believes that the reason tax debt is growing lies within the current economic crisis. Experts believe that enacting an aggressive policy to recover debt may lead to further growth in arrears.
Medvedev Introduces Tax On Real Estate. Senators Against Timing Of New Property Tax Proposal
At a meeting with advisors, Russian President Dmitri Medvedev spoke out in favor of a change in taxation on real estate that would increase tax rates on luxury items. Payments will increase substantially.
Property Taxes Based On Market Value To Be Introduced No Sooner Than 2012
The Bureau of Technical Inventory will calculate and levy taxes on a property held by organizations and individuals.
State Duma Drafts A Bill For Fast-Track VAT Reimbursement
According to the authors of the bill, if the law is passed, the fast-track method for VAT reimbursement will be available to exporters as well as organizations conducting capital investments.
Companies Without Profit Need Not Pay The Minimum Tax
If a company turns no profit, it does not need to pay the minimum tax.
Tax Breaks Planned For Companies In Moscow Region
The Moscow Region government has suggested increasing benefits to companies with intangible assets such as patents and trademarks.
Russia Declares Foreign Donations To NGOs Tax-Free
If funds received from foreign sponsors are used for authorized purposes, Russian NGOs will not have to pay taxes on the donations.
Officials Declare: Taxes Can Wait
Officials have proposed authorizing the tax inspection to grant delays or deferments to companies in making regional tax payments.
Important Changes In Federal Law "On Limited Liability Companies (OOO)"
On December 30, 2008 the Russian Legislation adopted several important changes into the Federal Law "On Limited Liability Companies / OOO". The changes will come into force on the 1st of July, 2009.
Lapse In Document Verification
A businessman was not able to provide some documentation because it was in the possession of law enforcement agencies. The Supreme Arbitration Court came to the conclusion that the businessman was fully justified in arguing that producing these documents had been impossible.
Supreme Court Proposes Collection of Unpaid Taxes Without Court Approval
The Supreme Court proposed an amendment to Article 48 of the Tax Code. The amendment would allow taxes, fines, and penalties to be collected without a court sanction.
Two Laws Proposing Changes To Tax Legislation Approved
The Federal Council has begun considering a bill entitled "On Enacting Amendments to Article 27, of the Second Part of the Tax Code of the Russian Federation." According to the proposed amendments, agricultural sector salaries would be exempt from taxation.
Court Considers Outsourcing Issues Again
A Russian court recently ruled, again, that transferring employees to other organizations cuts costs by optimizing staff management.
FAS Proposes To Fine Officials Over Projections
The Head of Federal Antitrust Service (FAS) has proposed fining and disqualifying officials for projections which may affect the markets.
Minister Calls For Strong State Ideology To Fight Tolerance To Corruption
Justice Minister Alexander Konovalov said a strong ideological campaign is needed for overcoming public tolerance to corruption.
Supreme Court Chairman Says Verdicts In Big Bribe Cases Still Rare
Cases involving big bribes or bribes received by organized groups are quite rare in judicial practice, Supreme Court Chairman Vyacheslav Lebedev said.
Second Anti-corruption Package To Simplify Receipt Of Regulatory Decisions
The second part of anti-corruption legislation to be adopted in 2009 will simplify the receipt of regulatory decisions and ban unscheduled inspections of organizations and businesses.
The Defender Of Civil Society: Easing The Law On Non-Profit Organizations
President Medvedev has established a working group, headed by Vladislav Surkov, to work on measures to liberalize the law on non-profit organizations.
Constitutional Court To Help Establish Moscow's Boundaries
Deputies of the Moscow Region Duma will consider a request proposed by the Constitutional Court to interpret Part 1, Article 85 of the Russian Federation's Constitution.
The Ban On Gambling Will Be Implemented On Schedule — No Exceptions
As of July 1, 2009, gambling will be prohibited throughout Russia, except for in four specified gambling zones, as established by Federal Law Number 244-F3, December 29, 2006.
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Managing Foreign Currency Losses in a Ruble Economy - Financial and HR Aspects
With the dramatic drop in the ruble’s value, many business have found that exchange rate losses are not only a financial problem but often an HR management issue as well. We found that the main key to facing both challenges was constant and effective communication.
FMS Offers Patents For Companies Hiring Workers From CIS
Nezavisimaya Gazeta writes that Russians will soon be able to hire foreign workers.
Tax Inspectors Want To Approve Staff Registers
The Tax Authorities rejected a company's reported expenses for financial consultation services based on the fact that the company's staff already included more than ten accountants.
Moscow Businesses Gradually Legitimizing "Black" Wages
During the first few months of 2009, over 55% of businesses who had previously been "under-paying," raised their salaries to a "legal" level.
Moscow Tax Authorities Tally The Score In Battle Against "Grey" Salary Schemes
The Moscow Department of the Federal Tax Service (FNS) that works with "problematic organizations" summed up the statistics for 2008 and the first quarter of 2009. Data for all of Russia is not yet available.
Russia To Turn The Unemployed Into Entrepreneurs
Russia has a passed a decree to lend financial support to the business-minded and unemployed.
Most Russians Say Their Labor Rights Lack Protection
An overwhelming majority of the polled Russians - 81 percent - believe that their labor rights are not protected properly, as follows from the results of an opinion poll by the national public opinion studies center VCIOM. A tiny 9 percent have the opposite point of view.
Medvedev To Take Steps To Avert Major Labor Conflicts – Source
President Dmitry Medvedev "plans to carry out a set of measures this week" to preclude developments such as the recent events in Pikalyovo, Leningrad region, where wage delays and business suspension made several hundred people block a highway in protest on June 2, a Kremlin source said on Tuesday.
Notify Your HR!
There is much more HR information available in the Russian version of this same newsletter!
The Geography Of Recession
The most important aspect of the United States is not simply its sheer size, but the size of its usable land. Russia and China may both be similar-sized in absolute terms, but the vast majority of Russian and Chinese land is useless for agriculture, habitation or development.
Как торговаться – How To Haggle
How does one haggle at a Russian marketplace? How does one negotiate a cab fare in Russia? This Russian Mini Lesson looks at these questions - which are especially practical for anyone living in Russia!
New Tripartite Customs Union: Implications for Trade and Geopolitics
PBN's latest issue of Policy Matters examines Russia's recent aboutface on its WTO application, withdrawing its individual application and proposing to apply as part of a regional trade union.
The Caucasus in the Global Financial Crisis
This issue of the Caucasus Analytical Digest analyzes the economic development of Georgia, Azerbaijan and Armenia in the context of the financial crisis. The featured articles provide macroeconomic and financial indicators for each country and discuss the implications of the crisis for national development as well national anti-crisis programs.
Geography Of Offshoring Is Shifting, According To A.T. Kearney Study
India and China continue as top offshoring destinations; but Central/Eastern Europe falls while Southeast Asia and Middle East countries rise.
- News Monitoring -
The following news reviews were developed in conjuction with Alinga's partners, the School of Russian and Asian Studies and the US Russia Chamber of Commerce of New England.
Economic News In Review
Business sectors and Russia's domestic and foreign activities and policies.
Civil society, demographics, media, education, and more.
News from Eurasia
Protests in Georgia; Moldova without a president; Ukraine gas conflict may resume.
Politicians, political parties, the opposition, and Russia's regions.
How Russia gets on with its "far abroad."
How the News is Reported in Russia
Labor Unrest in Russia; the EU energy summit; South Ossetia's elections; and more.
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