Small and medium-sized business in Chechnya - 2

A simplified system of taxation based on patents allows small-scale businesses to save fees
The Chechen government is applying additional measures for the development of medium and small-scale business in the republic. 165 million roubles have been allocated to implement the program "From survival to prosperity" this year.


Among the measures are the creation of a 'business incubator' in Urus-Martan, construction of a rehabilitation centre in the settlement of Znamenskoye and passing the law "On development of small and medium-scale business in Chechen republic". The Chechen government's
proposals also include the total abolition of taxes for Chechen businessmen for 5-7 years. This would allow the businessmen who are currently working in the black market to become legitimate.


The tax offices of the republic report that 3531 legally recognised individuals and 17467 separate businesses are registered in the republic. In total they paid about 1.3 billion roubles last year in taxes and other fees to the budget of the Russian Federation.

In addition, a patent system of taxation is being introduced for 66 kinds of business activities. The patent system allows taxes to be seriously reduced. The patent is calculated on the basis of 6% of estimated income. This amount is the price of the patent. For example, if in Grozny the annual income for a car repair shop is estimated at 72 thousand roubles, the normal tax would be 5594 roubles, while the patent costs only 4320 roubles. Moreover, the owner of the auto-repair shop may hire up to 5 workers during the year and the cost of the
patent will not change.


Timur Utsayev, Grozny, exclusively for VK