FNS has allowed foreign companies to register a legal entity in Russia
Photo: TASS/Kirill Zykov
The Russian authorities have simplified the life of foreign Internet companies. Foreign companies receiving income in Russia, given the opportunity not to create a legal entity in our country — the taxes they can pay through local partners. Such clarification received from the Federal tax service (FTS) operating in Russia search service and call taxi Uber.
From January 1, foreign companies trading in Runet electronic content, must pay an 18 percent value added tax (VAT). Relevant amendments to the Tax code adopted in the summer of 2016, called “tax on Google” — now VAT in Russia have to pay Google and Apple, get paid for paid apps in the stores of the Android and iOS platforms. This should equalize the position of the Russian and foreign Internet companies in our country. According to one of the bill’s authors, state Duma Deputy Andrei Lugovoi, a “tax on Google” will bring to the Russian Treasury every year 10 billion rubles.
At the end of 2016 in response to a request on Uber, explained that the company is working with Russian taxi drivers can transfer VAT through them. The Russian Uber partners must be registered as firms or individual entrepreneurs, the procedure for payment of VAT must be described in the contracts with them. This position has been agreed with the Finance Ministry, said in a letter on 14 December.
In early January, Dutch company, Uber BV, which provides service outside of the U.S., has sent its Russian partners a letter concerning the new order of interaction (a copy is in “News”). “From 1 January 2017 e-services provided by Uber B. V. to its customers (i.e. you, the partners, not passengers) are subject to VAT at the rate of 18%. Rate applies only to the fee companies Uber B. V. and not to the entire amount you paid passengers. According to the law you are tax agents companies Uber B. V. and must transfer the appropriate VAT amount to the budget”, — the document says.
— Uber compensates its partners the payout in the budget for VAT, — told “Izvestia” Irina Guschina, Director of communications in Russia and the CIS. — We are not planning an immediate renewal of contracts with partners. At the same time we informed them about the new legal requirements and in the near future organize information sessions to explain possible issues.
Stanislav Shvagerus, the expert of the International road transport Union (the organization protects rights in Russia “offline” taxis), believes that the FNS has taken a wrong stand with regard to Uber. In his opinion, it is necessary to develop a separate taxation mechanism for taxi aggregators.
— Registered in Russia, OOO “Uber technology”, the company recognized a non-Russian tax resident, he said. — The service is ready to indemnify the partners, only to leave the ability to immediately divert the money of the passengers in the Netherlands. And paid a tax only on the profit of the company.
Position, on that the service provided by Uber — information, contrary to Russian law, he said. In his opinion, in fact it is a service of chartering of a vehicle with the means of communication — the passenger pays for carriage and not for the information service, as established in its rules Uber.
— To carry passengers in Russia everybody is obliged under Russian law. And to pay tax too, as any taxi station, — VAT, profit, salary, — said Stanislav Shvagerus. — Gett, “Yandex.Taxi” Uber and identical services. No matter Russian or foreign, they need the same taxes, and the state should obtain information about each taxi committed via the Internet.
According to the Director for project activities of the Institute of development Internet (IRI) Arseniy Salicina, the price of the trip, Uber calculates based on the selected driver the fare, distance and duration of travel, etc. the company will in any case receive a Commission of 20% of the cost of the trip.
Legal drivers with permission for passenger transport, pay all the necessary taxes, depending on the form of taxation, — said Arseny Weltzin. — Commission Uber also may be taxed. This nuance is addressed in the agreement between the service and drivers. Will Uber increase any hidden fees or commissions for drivers, depends on the integrity of the service.
As has declared “news” Stanislav Shvagerus, taxi drivers in Russian regions “massively terminate partnership agreements with Uber ahead of inspections of FNS and related risks.” The mission of Uber this information did not comment.