A territory of priority social and economic development

REQUIREMENTS
to residents and investment projects being implemented by residents of territories of priority social and economic development and created in the territories of single-industry municipalities of the Russian Federation (mono-cities)

A territory of priority social and economic development is a part of a territory of a subject of the Russian Federation where a special legal regime for business and other activities is set in accordance with the resolution of the government of the Russian Federation to establish favorable environment for attracting investment, providing accelerated economic development and creating comfortable conditions for life activities of population. A territory of priority social and economic development is created for 10 years.

Commercial organizations (except state and municipal unitary enterprises, financial organizations including credit and insurance organizations, as well as professional participants of the securities market) registered and operating in the territory of a mono-city and not being town-forming organizations of a mono-city or their daughter organizations can become residents of territories of priority social and economic development in mono-cities.

The register of residents of territories of priority social and economic development is maintained by the Ministry of Economic Development of the Russian Federation based on the information provided by the executive authorities of the subjects of the Russian Federation.

Requirements to residents of territories of priority social and economic development

  • A legal entity is registered in the territory of the city. Federal Law dd. December, 29, 2014 No. 473-FZ, article 34
  • A legal entity is not in the procedure of reorganization, liquidation or bankruptcy. Federal Law dd. December, 29, 2014 No. 473-FZ, article 13
  • A legal entity has no uncollected taxes, levies, insurance contributions to non-budgetary funds or other debts to the budget system. Federal Law dd. December, 29, 2014 No. 473-FZ, article 13
  • A legal entity has no separate subdivisions (branches, representational offices) located outside territories of priority social and economic development. – Federal Law dd. December, 29, 2014 No. 473-FZ, article 12
  • A legal entity is not a participant of regional investment projects. – Federal Law dd. December, 29, 2014 No. 473-FZ, article 12
  • A legal entity operates in a territory of priority social and economic development and makes investments (including capital investment).

Special legal regime for business activities

A preferential regime for business activities will be established for residents of territories of priority social and economic development. This regime will include the following principal items (table 1).

Table 1. Tax advantages for residents of territories of priority social and economic development

Tax type

Ordinary rate

Rate for residents of territories of priority social and economic development

Income tax

20%

1-5 years

0%

6-10 years

10%

Property tax

(regional budget)

2,2%

1-5 years

0%

6-10 years

0%

Land tax

(local budget)

1,5%

1-5 years

0%

6-10 years

0%

Contributions to non-budgetary funds

30%

1-10 years

7,6%*

* this reduced rate of insurance payment is applied to residents who have gained such a status not later than within 3 years since the date of establishment of a territory of priority social and economic development in a mono-city.

Under article 284.4 of The Russian Tax Code a taxpayer being a resident of a territory of priority social and economic development can apply tax rates to a taxation base if the following conditions have been fulfilled:

1) proceeds of activity carried out in the course of the agreement on carrying out activities in a territory of priority social and economic development amount not less than 90% of all proceeds considered while determining the tax base for tax on the profit;

2) a taxpayer maintains separate records of income and expenses earned from (incurred in) activities carried out in the course of the agreement and income (expenses) earned from (incurred in) carrying out other activities.

CATALOGUE

of classes of the Russian Classification of Economic Activities (ОК 029-2014 (NACE version 2) which includes such economic activities where a special legal regime for business activities in a territory of priority social and economic development of Cherepovets is applicable

 

No.

Name of economic activity according to OKVED

1

OKVED 01 – Plant and animal production, hunting and rendering services in these spheres

2

OKVED 02.30 – Collection and storage of edible forest resources, non-wood forest resources and medicinal plants

3

OKVED 03.12 – Freshwater fishing

03.22 Freshwater fishing

4

OKVED 08 – Extraction of other mineral resources

5

OKVED 10 – Food production

6

OKVED 11 – Beverage production

7

OKVED 13 – Production of textiles

8

OKVED 14 – Production of clothing

9

OKVED 16 – Wood processing and production of woodware and phellem goods except furniture, production of straw goods and materials for weaving

10

OKVED 17 – Paper and paper products manufacture

11

OKVED 20 – Chemical material production

(except 20.15.1-20.15.6)

12

OKVED 21 - Manufacturing of drugs for medical purposes

13

OKVED 22 - Manufacture of rubber and plastic products

14

OKVED 23 – Manufacture of other nonmetallic mineral products

15

OKVED 24 – Metallurgical production (except 24.1. Cast-iron, steel and ferroalloy production, 24.4. Production of main precious metals and other nonferrous metals, nuclear fuel processing)

16

OKVED 25 – Production of ready-made metal products, except vehicles and equipment

17

OKVED 26 – Production of computers, electronic and optical goods

18

OKVED 27 – Electrical equipment manufacture

19

OKVED 28 – Production of vehicles and equipment not included into other groups

20

OKVED 29 – Production of motor vehicles, trailers and semi-trailers

21

OKVED 30 – Production of other transport vehicles and equipment

22

OKVED 31 – Furniture production

23

OKVED 32 – Production of other ready-made products

24

OKVED 33 – Maintenance and assembly of vehicles and equipment

25

OKVED 55 – Activities on provision of temporary accommodations

26

OKVED 62 - Computer software engineering, consultative services in this sphere and other related services

27

OKVED 63 – Activities in the sphere of IT

28

OKVED 86 – Activities in the sphere of public health services

(except 86.23 – Dental practice)

29

OKVED 93 – Activities in the sphere of sport, recreation and entertainment