Progressive taxation in Russia from 2025: new standards and examples

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In 2025, Russia is entering a new era of taxation with the introduction of a progressive scale of taxes on personal income. This change marks a significant shift from the fixed rate of 13%, which has been in effect for more than two decades, to a more complex system designed to increase tax revenues and reduce social inequality. In this article, we will look at the structure of the new system and present specific examples of its application.

The new tax scale

The progressive tax scale, which will be introduced in Russia from 2025, provides for the following rates:

  • Incomes of up to 2 million rubles per year will be taxed at a rate of 13%.
  • Income from 2 million to 5 million rubles — at a rate of 20%.
  • Income over 5 million rubles — at a rate of 25%.

Examples of tax application

For clarity, let’s look at examples of how this will work in practice:

  1. Example 1:
    • Income: 1.5 million rubles per year.
    • Tax: 13% of the total amount, which will amount to 195,000 rubles.
  2. Example 2:
    • Income: 3 million rubles a year.
    • Tax: 13% for the first 2 million (260,000 rubles) and 20% for the next million (200,000 rubles), for a total of 460,000 rubles.
  3. Example 3:
    • Income: 10 million rubles.
    • Tax: 13% for the first 2 million (260,000 rubles), 20% for the next 3 million (600,000 rubles) and 25% for the last 5 million (1,250,000 rubles), a total of 2,110,000 rubles.

Ожидаемые результаты и вызовы

Progressive taxation is supposed not only to increase tax revenues, but also to promote a more equitable distribution of wealth. However, like any significant reform, it faces challenges, including the risk of increasing the tax burden on the business sector and a possible increase in tax evasion.

The introduction of progressive taxation in Russia from 2025 is a significant step in the development of the country’s fiscal policy. This change requires careful planning and adaptation on the part of both taxpayers and tax authorities to ensure its effectiveness and fairness.

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