On May 30, 2024, at a meeting of the government approved a package of bills on changes in the tax system, which was prepared by the Ministry of Finance.

A five-tiered personal income tax scale is proposed

Amendments will be made to the Tax Code and the changes will enter into force on January 1, 2025.

Depending on the amount of income, personal income tax rates will vary. The minimum tax rate of 13 percent will be retained, while the maximum rate is planned to be no more than 22 percent.

Progressive taxation will affect only those with high incomes. For families with two or more children will offer additional deductions for personal income tax.

The Ministry of Finance proposed to calculate the tax as follows:

  • for annual income up to RUB 2.4 million, the rate does not change and remains at 13%;
  • if a person earns between RUB 2.4 million and RUB 5 million per year, the income tax rate will increase to 15%;
    Example #1 If an employee’s salary (income) is 240,000 rubles per month, then in January-October 2025 the amount of personal income tax will be 13% monthly, and in November and December 15% will be withheld, i.e. the employee will pay “additional” personal income tax in the amount of 9,600 rubles for 2025 (240,000rub*2 months*2%).
  • For income from 5 million to 20 million RUB per year, tax is to be calculated at the rate of 18%;
    Example #2 If the salary (income) of an employee is 600,000 rubles per month, then in January-April 2025 the amount of personal income tax will be 13% per month, and in May-August 15% per month will be withheld, and in September-December – 18%. The amount of additional personal income tax will be RUR 66,000 for 2025.
  • For income between 20 million and 50 million RUB, the rate will rise to 20%;
  • if a person earns an amount of RUB 50 million or more per year, he or she will have to pay tax at the rate of 22%.

New personal income tax deductions will be introduced in addition to the new rates. Parents with two or more children will be able to refund up to 7% of remitted personal income tax. The project presents a system of personal income tax refunds, when at the end of the year the due percentage of withheld tax of such parents is returned to them automatically through social services.

A new idea is the personal income tax cacheback. In addition to deductions, for the first time promised a cacheback on the tax. This was announced by the Minister of Finance. Tax refunds are also going to families with children. In addition, deputies at the hearing proposed to introduce another deduction – for the treatment of pets. They believe that such a deduction is necessary, because treatment is sometimes expensive. But it is not certain that the Ministry of Finance will include this amendment in its bill.