In response to growing concerns from entrepreneurs and business lobbies, Russia has delayed its plans to further reduce the VAT threshold for small businesses. The decision comes amid warnings from small business owners and advocacy groups that cutting the VAT threshold could force many small firms to shut down or operate in the shadow economy.
The government’s original plan had been to lower the VAT threshold, which would have required businesses with annual revenues below a certain level to start collecting and paying VAT. However, this move was met with significant pushback from business leaders and entrepreneurs, who argued that it would disproportionately affect small enterprises and potentially lead to a decline in economic activity.