reference

LAW OF THE RUSSIAN FEDERATION

NO. 2030-1 OF DECEMBER 13, 1991

ON THE PROPERTY TAX OF ENTERPRISES

(with the Amendments and Additions of July 16, December 22, 1992,

March 6, June 3, 1993, November 11, 1994, April 25, June 23, August 22,

1995, January 8, 1998, February 10, May 4, 1999, July 24, 2002)

 Resolution of the Supreme Soviet of the Russian  Federation  No. 2031-1
 of December 13, 1991 on Procedure of Putting into Effect the Law of the
 Russian Federation on Taxation of Property of Enterprises        

Article 1. Under this Law tax-payers shall be:

enterprises, institutions (including banks and other credit organizations) and organizations, including those with foreign investments, which are considered to be legal persons by the legislation of the Russian Federation;

branches and other similar subdivisions of the above-said enterprises, institutions and organizations, keeping a separate balance sheet and a settlement (current) account;

companies, firms or any other organizations (including general partnerships), set up in accordance with the legislation of foreign States, international organizations and associations, and also their isolated units having property in the territory of the Russian Federation, on the continental shelf of the Russian Federation and in the exclusive economic zone of the Russian Federation.

The taxpayers indicated in this Article shall be hereinafter referred to as enterprises.

The Central Bank of the Russian Federation and its institutions shall not be taxpayers under this Law.

Article 2. In accordance with the present Law, a tax shall be imposed on the fixed capital, nonmaterial assets, stocks and expenses that are on the payer's balance sheet. The fixed capital, nonmaterial assets, articles of little value and quick-wearing objects shall be taken into account by the residual cost.

The cost of the property pooled by enterprises in order to carry out a joint activity without forming a juridical person, for the purposes of the taxation shall be taken into account by the participants of the agreements on the joint activity that contributed the said property, and the property created (acquired) as a result of such activity by the participants of the agreements on the joint activity shall be taken into account in accordance with the share of property stipulated by the agreement.

Article 3. For the purposes of taxation there shall be determined the average annual cost of the property of an enterprise.

Article 3.1. Rules for calculating and paying the tax established by production sharing agreements shall be applied to production sharing agreements concluded between the Russian Federation and investors before the Federal Law on Production Sharing Agreements came into effect.

Article 4. This tax shall not apply to the property of:

a) budget institutions and organizations, bodies of legislative (representative) and executive power, bodies of local self-government, the Pension Fund of the Russian Federation, the Fund of Social Insurance of the Russian Federation, the State Fund of the Population Employment of the Russian Federation, and the Federal Fund of Obligatory Medical Insurance;

bar associations and their structural units;

b) enterprises producing, processing and storing agricultural produce, breeding, catching, and processing fish and sea products, provided that the returns from such types of activity constitute not less than 70 per cent of the total amount of the returns from the realization of the products (works, services);

c) specialized prosthetic and orthopedic enterprises;

d) enterprises engaged exclusively in serving the needs of education and culture;

e) religious associations and organizations, ethnic cultural societies;

f) enterprises of folk artistic handicraft industry;

g) used to form a reserve and a seasonal stocks at the enterprises connected with a seasonal (natural and climatic) cycle of deliveries and works, and also the stocks created in accordance with the decisions of the federal bodies of executive power, the relevant bodies of State power of the entities of the Russian Federation, and the bodies of local self-government;

h) housing, country-cottage and garage cooperatives, and gardening societies;

public unions and associations carrying out their activity at the expense of purpose-oriented contributions and organizations from the profit remaining at their disposal after the payment of the taxes and other obligatory duties, for maintaining such public unions and associations, unless they are carrying out a business activity;

i) non-governmental organizations of disabled persons, and also other enterprises, institutions and organizations in which disabled persons constitute at least 50 percent of the total number of employees;

j) the research institutions, enterprises and organizations of the Russian Academy of Sciences, the Russian Academy of Medical Science, the Russian Academy of Agricultural Science, the Russian Academy of Education, the Russian Academy of Architecture and Construction Sciences, and the Russian Academy of Arts, constituting their research, pilot-production or experimental base;

State scientific centres, and also research and design institutions (organizations, pilot and pilot-experimental enterprises, regardless of the legal organization forms and ownership forms, in whose volume of work the research, pilot-design and experimental works constitute not less than 70 per cent;

k) used (intended) exclusively for rest and recreation of children under 18 years of age;

l) the enterprises of the institutions enforcing the criminal sentences in the form of deprivation of liberty;

m) the Russian Federal Property Fund, the property funds of the entities of the Russian Federation, of districts (with the exception of city districts) and cities (with the exception of the cities of districts subordination);

n) specialized enterprises (according to the list approved by the Government of the Russian Federation) producing medical and veterinary immunobiological preparations designated to control epidemics and epizootics;

o) the management bodies and the units of the State Fire-Prevention Service, when they are carrying out their functions established by the legislation of the Russian Federation;

p) foreign and Russian legal entities, used for the period of the realization of the special-purpose socioeconomic programmes (projects) of house building, the creation, construction and maintenance of the centres of the professional retraining of servicemen, reservists and members of their families at the expense of loans, credits and gratuitous financial assistance granted by international organizations and governments of foreign States, foreign juridical and natural persons in accordance with intergovernmental and interstate agreements, and also agreements signed on behalf of the Government of the Russian Federation by the organs of State administration authorized by it.

The list of the legal entities exempted from the tax shall be determined by the Government of the Russian Federation.

q) of professional emergency-rescue services or professional emergency-rescue formations.

r) which is used only to perform activities envisaged by production sharing agreements, if such property is owned by investors in accordance with the above agreements, as well as if under the aforesaid agreements such property was handed over by the investors to the State property while retaining their exclusive right to use the above property.

Article 5. The value of the property of an enterprise, calculated for the purposes of taxation, shall be reduced by the balance (normative) value of:

a) facilities of housing, communal and socio-cultural spheres, which are fully or partially on the balance of a taxpayer;

b) facilities used exclusively for nature protection, fire safety or civilian defence.

c) property used for producing, processing and storing agricultural produce, or for breeding, catching and processing fish;

d) icebreakers, vessels with nuclear powers plants and vessels of atomic-technological servicing; main pipelines, railway communication tracks, automobile roads of general use, communications lines, electric power lines, and also installations designated to maintain the above-mentioned objects in operational state;

e) telecommunication satellites;

f) land;

g) specialized ships, mechanisms and equipment needed for use for not more than three months a year to provide the normal functioning of various forms of transport as well as of the public highways.

h) standard and test equipment for the territorial bodies of the Committee of the Russian Federation for Standardization, Metrology and Certification;

i) a mobilization reserve and mobilization capacities.

j) property received at the expense of gratuitous aid (assistance) in the first two years as well as property used for the purpose of direct rendition of gratuitous aid (assistance): for the term of its being used for these purposes.

The legislative (representative) bodies of the entities of the Russian Federation and the bodies of local self-government may establish for certain categories of payers additional privileges for the tax within the limits of the amounts entered to the budgets of the entities of the Russian Federation.

Article 6. The maximum amount of the tax rate on the property of an enterprise may not exceed two percent of the taxable basis calculated in accordance with Articles 3 and 5 of this Law.

The specific tax rates on the property of enterprises, determined depending on the types of the activity of the enterprises, shall be established by the legislative (representative) bodies of the entities of the Russian Federation.

Establishment of tax rate for individual enterprises shall not be allowed.

In the absence of any decisions having been taken by the legislative (representative) bodies of the entities of the Russian Federation concerning the introduction of specific rates of the tax on the property of enterprises, the maximum tax rate provided for by this Law shall be applied.

Article 7. The amount of tax shall be calculated and transferred to the budget quarterly with an increasing sum-total, at the end of the year a reassessment shall be made.

The amount of the payments of the tax on the property of enterprises shall be charged in equal shares to the republican budget of a Republic within the Russian Federation, the budget of a territory or region, the budget of an autonomous region, the budget of an autonomous area, the budget of a district or to the budget of a city or town at the place of the location of the enterprise.

The enterprises whose composition includes territorially isolated units having no separate balance sheet and settlement (current) account, shall enter the tax on the property of enterprises in the procedure established by the present Law to the revenue of the budgets of the entities of the Russian Federation and the local budgets at the location of the said units in an amount determined as the product of the tax rate effective on the territory of the entity of the Russian Federation on which such units are located, by the cost of the fixed assets, materials, little-worth and high-wear objects and goods of those units. In this case, there shall be subject to the payment to the budget at the location of the head enterprise the difference between the amount of the property tax calculated by the head enterprises as a whole for the enterprise and the tax amounts paid by the head enterprise to the budgets at the location of the territorially isolated units having no separate balance sheet and settlement (current) account.

Article 8. The calculated sum of the tax shall be charged as an obligatory payment to the budget as soon as possible, which relate to the expenditures on the financial results of the enterprise, with regard to banks and other credit organizations - the operational and various other expenses. The tax shall be paid by quarterly settlements within five days of the date set for submitting a book-keeping quarterly account, and for annual settlements, within ten days of the date set for submitting a book-keeping annual account.

The enterprise keeping the accounting of the values and operations connected with carrying out a joint activity, shall inform the participants of the agreement on the joint activity about the cost of the property created (acquired) as a result of its carrying out and constituting an object of taxation before the time established for submitting the tax calculations.

Moscow, House of Soviets of Russia

December 13, 1991

No. 2030-1