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Russia Sets Phased VAT Threshold Cuts for SMEs Through 2028

The revision replaces an earlier plan for an immediate drop to 10 million rubles in 2026.

Overview

  • Prime Minister Mikhail Mishustin announced the schedule at a government meeting: 20 million rubles in 2026, 15 million in 2027, and 10 million in 2028.
  • The current VAT liability threshold for small and medium businesses remains 60 million rubles in annual revenue.
  • The government is considering a moratorium on penalties for taxpayers who commit a first-time violation under the new rules.
  • Officials frame the approach as easing VAT application for SMEs while addressing risks such as business splitting to avoid the tax.
  • Further implementation will require follow-on regulatory actions by the government and tax authorities.