Mikhail Mishustin’s opening remarks:
Good afternoon, colleagues,
Before we start discussing the agenda, I would like to note important decisions regarding support for the national IT sector. Much has been recently accomplished in this area. Since 2021, Russian software developers have been given substantial incentives, as per the President’s instructions, and the revenue of IT companies has soared as a result. Payroll funds and the number of IT experts have increased.
It is important to avoid a slowdown in the development of the Russian IT sector, even amid the sanction-related restrictions. It is necessary to ensure the sustainable and uninterrupted operation of the IT infrastructure. And, of course, it is necessary to preserve the HR potential.
We will therefore see to it that current tax preferences cover developers of mobile apps. Organisations selling, installing, testing and maintaining Russian engineering solutions will also be able to apply for such privileges.
In the next three years, all IT companies will be exempted from profit tax, and oversight agencies will not monitor their performance. They will be eligible for soft loans, with an annual interest rate of not more than three percent, to continue their operations and implement new projects.
The Government will also allow the staff of such companies to take out low-interest mortgages. Specialists under the age of 27 will not be conscripted if they are working for Russian IT companies.
We will also expand a programme of grants for the development of national engineering solutions.
All this will speed up the development of the Russian IT sector and will facilitate its future development.
The relevant presidential executive order has been signed.
I would like the Ministry of Digital Development to promptly draw up all the necessary documents, so that companies can benefit from the new measures as soon as possible.
Much of it was formed following yesterday's operational headquarters meeting where we discussed additional measures to improve the stability of the Russian economy under the pressure of external sanctions.
We will review a draft federal law, under which the Government will receive the mandate to respond swiftly and flexibly to changing circumstances, including the ability to quickly redistribute budget allocations during this year at the federal and regional level alike and to replenish the reserve fund, among other things. This will make it possible to redirect funds to cover first-order expenses.
The economic situation calls for taking quick and effective decisions. We are about to amend a number of regulations in order to improve social protection and help our people get through this difficult period.
The Government will receive additional authority which will enable it to act swiftly when it comes to making decisions on a wide range of medications and medical products.
We will be able to impose restrictions on the export of medical products from our country that were delivered from the countries that joined the sanctions.
Another measure is aimed at incentivising the production of medications that have no Russian alternatives. The Government will be entitled to establish a special licensing procedure for pharmaceutical companies, as well as maintenance of medical devices.
We will establish a special mode of operation for the companies that supply medications and medical products under contract. If they are affected by the sanctions, the terms of their contracts may be revised before the end of this year.
Now, let’s move on to the items that concern support for the private sector.
The Government will introduce a moratorium on scheduled inspections of sole proprietors and small- and medium-sized businesses effective March 10 through the end of the year except in cases involving risks to life or health of our citizens.
We will continue to support entrepreneurs and help them raise capital, by way of, among other things, creating proper conditions for taking out low-cost loans.
The President paid special attention to providing assistance to organisations and enterprises and directed the Government to implement the necessary steps to support such companies.
The updated FOT 3.0 loan support programme went live in late 2021 and is intended to help the private sector maintain employment and meet its obligations in terms of wages, lease payments and utility bills.
This step opened access to low-cost loans for the private sector. Over 42,000 loans were issued as of the end of 2021, with businesses receiving almost 150 billion roubles in loans.
The Government will allocate an additional 6 billion roubles in order to keep interest rates low.
On behalf of the President, the Government will renew, for another six months, the programme for paying refunds to small- and medium-sized businesses to cover the costs incurred in using the faster payment system. We will allocate 500 million roubles towards this end.
We will use subsidies and the Bank of Russia’s new payment service to issue full refunds to companies for the bank commissions involved in individual customers’ purchases of goods and services from January through June 2022.
Importantly, the domestic faster payment system is a reliable and convenient alternative to traditional purchase payments at retail stores using bank cards, especially so with the persisting risks of our country becoming disconnected from the international payment system.
The Government will help businesses protect their assets amid an abrupt increase in political pressure in foreign countries which opened season on Russian assets. The latest news only confirms this.
A fourth even more ambitious phase of capital amnesty will be launched.
The parameters included in the third phase will be enhanced by an option to report cash funds. Also, the law will replace the term “securities” with “financial assets” which will make it possible to legalise, in addition to shares and bonds, derivative financial instruments, such as futures and options.
We will also continue to improve the conditions for implementing investment projects in our country. We will introduce a number of amendments to laws to improve the operation of the public-private partnership mechanism. President Putin mentioned the need to make more active use of this form of cooperation, and possible changes in the existing practice have been repeatedly discussed with members of the business and expert communities.
There are plans to reinforce incentives for private initiative. Online tenders will be permitted to get concessions for facilities. Under the current epidemiological conditions, this is much safer and it will cut the cost of paperwork.
We will expand the list of facilities that could be taken in concession through construction in progress. We hope that these changes will be helpful to all participants in concession deals.
We will also consider important amendments to the Tax Code. The Government will acquire the right to make rapid changes regarding tax, including by extending tax payment timeframes. The same authority will be given to the supreme bodies of state power in the regions of the Russian Federation with regard to regional and local taxes. The new arrangement will be in effect throughout this year.
We are introducing this in order to facilitate rapid decision-making to support businesses and individuals. This is similar to the way work was organised in 2020, when a rapid response to challenges of the Covid-19 pandemic was necessary.
The Government has supported the decision to abolish VAT on precious metals for individuals as of 1 March. The State Duma is planning to consider a relevant draft law on 4 March.
People buying gold from a bank will not have to pay 20% value-added tax, as they do under current laws. This investment may become a good alternative to buying hard currency.
And now let us look at the support for farmers.
There is a reduced-rate lending mechanism for the benefit of entrepreneurs engaged in production and processing of agricultural produce. They can obtain loans at a low interest rate. This is only possible thanks to the federal budget’s support.
Today, we will take the decision to allocate 5 billion roubles for these purposes and we will subsidise over 8,000 earlier agro-industrial loans. This decision is of particular importance during the sowing campaign, which has already begun in a number of regions.
I have listed just a few of the more sensitive topics. To be sure, the Government has been monitoring all matters of importance to the residents of Russia and will promptly respond.