The government has approved amendments to the Tax Law aimed at closing several tax evasion loopholes and strengthening oversight over pricing in intercompany transactions. This development was reported by RBC. The reforms focus on tightening transfer pricing controls and increasing transparency in related-party dealings between businesses with common ownership or influence.
The measures foresee higher penalties for violations of transfer pricing rules. For foreign economic transactions, the penalty threshold is set at no less than 500,000 rubles. The scope of who is considered a dependent or related party is expanding to include foreign entities controlled by a single controlling person. In practical terms, this broadens accountability for pricing strategies across multinational structures and affects how intercompany charges are assessed.
Additionally, a 15 percent tax is imposed on all services and work provided to Russian companies by foreign independent firms. This levy effectively resembles a tax on non-market price arrangements and may influence the economics of cross-border service arrangements. Experts warn that the most impactful consequence for the business sector will be steeper penalties for using non-market prices, with the total potential cost sometimes reaching 300 to 400 percent of the outstanding amount once penalties are included.
Earlier, the Federation Council approved tax advantages designed to support talented youth and mothers, broadening the social policy component of the fiscal framework.
There are also reports of adjustments affecting American citizens with permissive tax arrangements related to Russia, indicating ongoing changes in international tax cooperation and compliance rules.
These developments reflect a broader push to align corporate taxation with market-based pricing principles while tightening enforcement. Companies operating in Canada and the United States should monitor how these measures interact with international tax planning rules, transfer pricing methodologies, and penalties for non-compliance. The changes underscore the importance of robust transfer pricing documentation, clear allocation of profits and costs across borders, and diligent monitoring of pricing practices within multinational groups. Source: RBC