The State Duma of the Russian Federation has finally passed the long-awaited law on tax incentives for export software development companies based in Russia.
The law was prepared by the Ministry of Information Technologies and Communications and has already passed the third final hearing in the Duma. According to the new legislation, companies engaged in software outsourcing activities will get a major tax relief due to the reduced unified social tax paid per employee. To be able to act under this new legislation, a company needs to generate more than 70 % of its revenue from IT consulting, software export or other IT outsourcing services and have not fewer than 50 employees on its payroll.
It is expected that the updated legislation will come into force on September 1, 2006.
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