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The Finance Ministry has rejected the idea to tax Apple and Google

Apple and Google will not pay VAT from applications sold to the Russians through online stores of companies. The Finance Ministry has rejected the idea to tax telecommunications services, which foreign IT giants have in Russia.

As reported by “Izvestia” with reference to the updated draft guidelines for tax policy”, from the idea to create a mechanism for more taxation for Google and Apple decided to give up. Foreign IT-companies in the provision of services as in the past will continue to pay taxes in the countries in which registered. This means that when buying apps, video and audio content in the virtual stores of foreign companies in the Russian users, VAT on these services will not be paid to the Russian budget.

As can be seen from publications in the media, this decision was made due to the fact that this issue is an international issue. The decision on this issue should expect from international organizations, according to the Russian government.

Recall that in March there were reports about the meeting in the presidential administration, which was attended by members of the administration, working with the assistant to the President Igor Shegolev, representatives of Roskomnadzor and the state Duma. The meeting then discussed the question of additional taxation of foreign Internet companies.

The meeting participants decided that Apple and Google are definitely underpaid taxes to the Russian budget. As an example, consider the situation when the Russian users buy in online App stores, iTunes and Google Play apps, music and movies to their mobile devices, these payments are not taxable in Russia – purchases are made directly from foreign companies.

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The participants of the meeting, agreement was reached on the need to develop additional mechanism of taxation – for example, to decide how to force foreigners to pay VAT on income from the sale of content via cloud services.

During the discussion elaborated upon the idea to prohibit direct payment applications with cards of Russian banks and charge VAT “on the road”. Concrete measures were discussed, however, following the meeting, none of them was not accepted.

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