Putin signs law on windfall tax

(Reuters) – President Vladimir Putin has signed a law introducing a windfall tax on excess profits of Russian companies, which was published on a government website on Friday.

The law, passed by parliament last month, is aimed at raising 300 billion roubles and easing strain on the budget as Russia wages its war in Ukraine. Reuters reported exclusively on Friday that Russia had doubled its 2023 defence spending target to more than $100 billion, or a third of all public expenditure.

The windfall tax rate will be 10% of the difference between firms’ average profit for 2021-22 and their profit for 2018-19. Firms can get a 50% discount if they pay before Nov. 30.

There are exemptions for a series of sectors including small and medium-sized businesses and oil, gas and coal companies.