The way to increase the budget revenues by reducing taxes for industrial enterprises

A flexible taxation system has been proposed, in which reduction of the tax burden on industrial enterprises is directly connected with an increase of the share of reinvested profit. Reduction of the tax burden is done by decreasing the rates of profit tax for 4.5 points. Using the method of the added value calculation, the budgetary efficiency of the proposed tax system has been examined. It has been proven that at the volume of reinvested profit of 75% and more, the new tax system can be more effective than the current tax system in the second year of its application. While the total tax load on industrial companies is reduced by 1 percentage point. The proposed system of taxation is recommended for consideration by the regional parliaments of the entities of the Russian Federation.

GDP growth, reinvestment, profit tax rate, regional tax legislation, budgetary efficiency, added value, productivity of capital, tax burden, VAT, property tax, investment attractiveness