International Property Tax Institute s Mass Appraisal Valuation Symposium. The new model of the real property tax in the Russian Federation

Transcription

1 s Mass Appraisal Valuation Symposium In co-operation with the City of Calgary Assessment Business Unit Ensuring Valuation Consistency in Turbulent Times: How to Deal with Natural Disasters and Economic Downturns June 18-19, 2014 Calgary, Alberta The new model of the real property tax in the Russian Federation Presented by: Irina Kalashnikova Head of Valuation Department Gruppa Kompleksnykh Resheniy Ltd, Russia

2 Presentation Outline The Russian Federation in figures Characters of the active real property tax system The real property tax system changes Cadastral valuation of real property Сonclusion

3 The Russian Federation in figures Area km² 85 federal subjects Population mln. people Gross domestic product billion rubles

4 The Russian Federation real property in figures Real property objects in number (about) residential real property objects non-residential real property objects total

5 Characters of the active property tax system

6 Land tax Individuals property tax Corporate property tax Taxpayers Organizations, individuals and individual entrepreneurs owners of land Individuals who are owners of the property recognized as taxable objects Organizations in possession of property objects which are identified as taxable objects Taxable object Land plot Residences, apartments, rooms, country homes, or other structures, premises and buildings, as well as ownership shares is such property Immovable and movable assets recorded in the balance sheet as fixed assets Tax base Cadastral value of the land plot Integrated Inventory value Annual average value of property Tax rate 0,3% -for agricultural, residential and utilities infrastructure lands; 1,5% - for other types of land use Differentiate within certain limits according to inventory value and type of use of a taxable object Cannot exceed 2,2% of taxable value Tax calculation Different for and individuals By tax authorities based on data provided by the cadastral and registry federal authority Organizations make selfassessment of tax amounts and advance payments

7 Tax statistics

8 Shortcomings of the active property tax system Considered the tax policy we can make the conclusion that the active real property tax system is non-optimal in main points: It does not provide local budgets with sufficient level of money receipts. There are problems with tax administration. The base of Individuals and corporate property tax is irrelevant.

9 Planned real property tax system changes Land tax + Individuals property tax Corporate property tax Real property tax Level Municipal Taxpayers, individuals and individual entrepreneurs owners of land and owners of the real property Taxable object Land plot, building, constitution, premises, object under construction, as well as ownership shares is such property. Tax base Cadastral value of the taxable object as of January 1st of the tax period year determined in accordance with the valuation activity law Tax rate Rates are established by local legislative acts and cannot exceed the rates specified by The Russian Tax Code: 0,3% - for agricultural, residential and utilities infrastructure lands; 1,5% - for other types of land use (1,5% for all types of land if a value of taxable object more than 300 million rubles) 0,1% -for residential real property; 0,5 % - for non-residential real property (0,5% for all types of real property objects if a value of taxable object more than 300 million rubles) for individuals; 2% - for non-residential real property for. Tax calculation Tax authorities make tax assessment based on data provided by registry and cadastral authority.

10 State cadastral valuation Selfregulation organizati on Subjects Of The Russian Federation Valuer Customer Subjects Of The Russian Federation Rosreestr Making a decision about the State Cadastral Valuation Creating the list of real property objects Determination of the cadastral value and drafting of the Selection of an Report executor and conclusion of the contract Expert Review of The Report Approval of the cadastral value and publication of approved results INTRODUCTION of CADASTRAL VALUE to The State Cadastre of real Property Consideration of disputes on the results 10

11 The main stages of the determination of the cadastral value OBJECTS of VALUATION 1. Real property market analysis LAND PLOT BUILDING PREMISES CONSTRUC TION OBJECT UNDER CONSTRUCTION 2. Analysis of the list of objects of evaluation 210% Валовой внутренний продукт 200% 190% 3. Collecting information about the values of a quantity of pricing factors 180% 170% 160% 150% 140% % % без исключения сезонных и календарных факторов 4. Gather market information с исключением сезонных и календарных факторов (январь %) 5. Construction of statistical models for the estimation and determination of the real property values 6. Making a report of cadastral value determination 7. Examination of the report of cadastral value determination

12 The property tax system changes relative to its elements Past Now Future? Elements Individuals property tax Real property tax: Corporate property tax Land tax Individuals property tax Real property tax: Corporate property tax Land tax Real property tax Year of introduction Planning since? Budget Municipal Regional Municipal Municipal Regional Regional Municipal Municipal Stocktaking of real property objects Technical inventory Taxpayers State cadastre of real property Technical inventory Taxpayers Authorized authorities of subjects of the Russia State cadastre of real property State cadastre of real property Tax base Inventory value Inventory value and residual value Cadastral value Inventory value Inventory value and residual value Cadastral value Cadastral value Cadastral value Calculation of tax base Technical inventory Residual value - taxpayer, Inventory value Technical inventory Valuation organization s Technical inventory Residual value - taxpayer, Inventory value Technical inventory Valuation Valuation Valuation Tax rates are established by Local governments Authorities of subjects of Russia Local governments Local governments Authorities of subjects of Russia Authorities of subjects of Russia Local governments Local governments Period of transition 12

13 Сonclusion The active property tax system is non-optimal. It does not do fiscal duty as well as it is needed. One of the main problems is using as tax basis value is incomparable with the actual market value of property. The growth of real property tax part in local budget can be provided by using cadastral value of real property objects as tax real property basis. This can strengthen the economic foundation, create strong financial base for municipal government, make land and real property use more effective and rational, give impulse for spatial development. The planned changes will reduce property tax number, make tax administration easier and more affordable. Implementation of real property tax based on real market value has been Russian tax policy long-range goal for the last 15 years. There has been done a lot for the implementation of new real property tax system - creation of the State Cadastre of Real Property, the real property tax experiment, the project of development and testing of the real property cadastral (mass) appraisal system, the determination of cadastral value of real property objects in every subjects of the Russian Federation. But there are many questions which must be considered and solved in the short run obligatory registration of all existent real property objects, interdepartmental communications problems, tax rates and tax remissions determination.

14 Gruppa Kompleksnykh Resheniy Ltd. Russia, , Moscow, 22 Bolshaya Yakimanka, office 9 Phone: +7(495) Russia, , Nizhniy Novgorod, 8 Motalniy Lane, office А301 Phone: + 7(831) ; info@gkr.su 14