The role of corporate income tax in budget formation

"Научный аспект №5-2024" - Экономика и менеджмент

УДК 336.22

Гусакова Наталья Леонидовна – кандидат психологических наук, доцент Белгородского государственного национального исследовательского университета.

Попова Дарья Николаевна – студент бакалавриата Белгородского государственного национального исследовательского университета.

Себякина Алена Андреевна – студент бакалавриата Белгородского государственного национального исследовательского университета.

Abstract: The article deals with the issue of the role of corporate profit tax in the process of formation of the consolidated budget of the Russian Federation. The structure of tax revenues to the consolidated budget of the Russian Federation, the order of distribution of corporate profit tax between the federal and regional budgets, the structure of profit tax revenues to the federal and consolidated budget of the subjects of the Russian Federation is considered. Also, a number of measures contributing to the increase in the volume of income receipts on the profit tax of the organization are offered.

Keywords: profit of organizations, tax, corporate profit tax, tax system, consolidated budget of the Russian Federation.

Increasing international competition makes the peculiarities of the tax system the most relevant issue of economic policy of any country.

The budget is a financial foundation for the state to fulfil its functions. Development of health care, education, culture, all kinds of infrastructure and implementation of social programmes directly depends on expenditures and, consequently, on budget revenues. Thus, the growth of budget revenues is one of the main goals of state and local governments. In this regard, a necessary condition for the functioning of the tax system is the simultaneous provision by it of stable revenue for the state and the creation of necessary conditions for the development of the real sector of the economy.

Taxes are an integral part of the functioning of the state. They allow to form a significant part of budget revenues. Funds received from taxes can be directed to ensure the functioning of various spheres of activity, socio-economic areas [3].

The revenue base of the consolidated budget of the Russian Federation is formed through a variety of tax and non-tax revenues. An important source of its formation is the tax on profit of the organisation. There is a direct correlation between the efficiency of the organisation of the tax collection process and the results obtained, reflecting the activity of the country's economy functioning.

The state through the use of taxes and fees has the opportunity to regulate the development of the country's economy and form the revenues of the budget system [2]. One of the taxes forming the budget of the country is the corporate income tax, it fulfils the interests of the state treasury.

The pie chart (Fig. 1) shows the structure of tax revenues based on the types that form the consolidated budget for 2023.

Fig. 1. Receipts by main taxes in the consolidated budget of the Russian Federation for 2023, % [1]

The pie chart reflects that the main share of consolidated budget revenues is represented by mineral extraction tax collections (about 31%), followed by corporate income tax collections (about 27%).

The main part in the structure of tax revenues to the budget of the Russian Federation for 2023 is the mineral extraction tax (30.3%). Then come corporate profit tax collections (26.4%), followed by VAT (22.5%), personal income tax (19.4%), and excise duties (1.1%).

The role of corporate income tax is to have a regulatory impact on the activities of organisations. The level of this impact is very high compared to other types of tax levies. Using differentiated tax rates, benefits, accelerated methods of depreciation accruals, the corporate income tax serves as a stimulus for investment and innovation economic processes. There are a number of privileges in the system of tax levies that act as support for certain areas of the country's economy.

This tax is a federal tax. This means that taxpayers, object of taxation, tax rates, types of benefits and payment terms are established by legislative acts of the Russian Federation. At the same time, any changes in tax rules can be made only by means of introducing clarifications to the tax legislation in accordance with the established procedure. Like all federal taxes, the profit tax is a mandatory tax. It is levied on the entire territory of the Russian Federation.

The tax under study was introduced by the state to form the budget as a whole, without a specific target application. Consequently, it can be defined as abstract or general.

Profit tax is direct, that is, its final amount depends entirely on the final financial result of the economic activity of enterprises and organisations. Looking deeper, it should be noted that the profit tax is paid from the really received income and reflects the actual solvency of the taxpayer, which means that the tax under consideration is considered personal direct.

Since the tax is direct and, therefore, depends entirely on the income received by the organisation itself, the state tries to exert influence by one or another means to stimulate or inhibit the activity of the enterprise. Thus, there are certain privileges in taxation for organisations that operate in the spheres of economy desirable for the state; to stimulate small business; for enterprises that direct a significant part of their income to reconstruction, technical re-equipment, as well as expansion of existing production.

In the budgetary system, the tax rate on profit tax is distributed by budget levels, which allows the implementation of regional projects of economic direction.

Article 284 of the Tax Code of the Russian Federation sets the corporate income tax rate at 20%, of which:

1) 2% is to be transferred to the federal budget;

2) 18% is subject to transfer to the budget of a constituent entity of the Russian Federation.

Profit tax is paid by:

1) Russian organisations;

2) Foreign organisations operating in the Russian Federation through permanent representative offices and (or) receiving income from sources in the Russian Federation [5].

Accordingly, the legislator considers the corporate profit tax as the most important instrument of regulation and distribution of revenues between the federal centre and the regions. Here we should pay attention to the fact that the subjects of the Russian Federation are characterised by significant socio-economic differentiation, most regions are subsidised, i.e., figuratively speaking, do not "earn" as much money as they need to solve the problems of ensuring a satisfactory level of socio-economic life in the republic, krai, region, etc. And it is the competent tax policy, realised also by means of normative-legal regulation, that allows to provide a decent level of development of "depressive" regions.

When calculating the tax payment, the taxpayer should determine the list of income and expenses, which he will determine in the current calculation period. Calculating the amount of tax payment, the tax base is determined, and it is multiplied by the value of the tax rate.

Based on the data of the Federal Tax Service reports on the accrual and receipt of taxes, fees, insurance contributions, and other mandatory payments [6], Table 1 shows the structure of tax charges for corporate income tax in the consolidated budget for the period from 2021 to 2023 calendar years.

Table 1. Profit tax revenues to the consolidated budget of the Russian Federation for 2021-2023.

Indicator	Years			Growth rate, %		Growth rate, %
	2021	2022	2023	2022/ 2021	2023/ 2022	2022/ 2021	2023/ 2022
Total revenue to the consolidated budget of the Russian Federation, RUB bln.	24 081 837	29 904 563	32 823 633	124,1	109,7	24,1	9,7
of which:
Income tax, RUB bln	5 584,1	5 773,1	8 223,7	103,3	142,4	3,3	42,4
to the federal budget, RUB bln.	1 374,1	1 551,0	1 739,8	112,8	112,1	12,8	12,1
to the consolidated budget of the constituent entities of the Russian Federation, RUB bln.	4 136,2	4 429,8	5 551,5	107,0	125,3	7,0	25,3

Tax collections to the consolidated budget in 2023 increased by 9.7% to 32.8 billion rubles compared to 2022. This is slightly higher than inflation, which totalled 7.42% in 2023. The growth of revenues in 2023 slowed down compared to 2022. In 2022 compared to 2021, the value of tax revenues in the consolidated budget increased by 24.1%, reaching 29.9 billion Russian rubles.

The decrease in the level of dynamic growth in 2023 is due to a decrease in oil and gas sales levies, which is associated with the change in the global price environment and lower oil prices.

2022 compared to 2021 showed a positive dynamic growth rate in the consolidated budget indicators, despite many sanctions and pressure from Europe and the United States. Regional budgets specialising in coal mining, oil and gas production and transportation, as well as those directly dependent on transfers from the federal budget, showed relatively high growth in revenues.

Revenues to the consolidated budget were reduced in the regional subjects of the Russian Federation, whose activities are influenced by the global nature, these include the metallurgical industry, ore mining and processing [4].

Figure 2 reflects the dynamic change in the consolidated budget of the Russian Federation in the amount of incoming income tax from 2021 to 2023.

Fig. 2. Dynamics of profit tax revenues to the consolidated budget of the Russian Federation in 2021-2023, billion rubles.

Analysing the dynamics (Fig. 2) of tax revenues for the period from 2021 to 2023, we can note its positive character.

During 2022 the receipts were carried out unevenly. According to the final indicators, the growth in 2022 compared to 2021 was 3.3 per cent. The growth of the final indicator is due to the increase in regional revenues of those regions that specialise in the extraction of coal, gas, oil resources and chemical industry. A decrease in revenues was recorded in the following sectors of the economy: extraction of metal ores, wood processing, metallurgical production and production of finished metal products, production of motor vehicles, medicines. Also, the decrease in revenues is associated with the return of tax overpayments arising due to the cancellation of the rule providing for the accrual of positive exchange rate differences, provided that the negative one is preserved, and the transfer of settlements from 01.01.2023 to a single account in the tax office with the automatic production of a single payment, including taxes and insurance contributions.

In 2023, income tax revenues increased by 42.4 per cent. Collections of this tax showed a positive financial result due to the corporate sector of the economy. At the same time, a one-off tax payment of 315.5 billion roubles was made for excess profits earned in 2021 and 2022, which exceeded 1 billion Russian roubles.В 2024 году ожидается рост поступлений по налогу на 6%.

Such an increase in revenues in the explanatory note to the budget for the planned period of 2024 is determined by the fact that there will be a dynamic growth in the profits of organisations, which have been showing positive dynamics for many years, dividend income, interest and income from the activities of foreign legal entities will increase, the taxable base will change.

In order to maintain positive dynamics in the receipt of tax payments on corporate income tax, it is necessary that the issues regulating taxation were fully worked out at the legislative level, problematic and weak points were resolved, the fiscal component and investment activity of legal entities were stimulated.

There are a number of measures that contribute to the increase in the volume of income receipts from corporate income tax:

1) removal of income of entrepreneurial activity from shadow to legalised;

2) improvement of the investment climate in the country, as well as socio-economic situations in the regions;

3) financial assistance to low-profit organisations;

4) tightening tax control, detection and prevention of illegal methods of taxpayers to reduce the tax base;

5) improving the quality and justification of profit tax benefits;

6) increasing the optimisation of control processes over tax transactions, which implies an increase in the number and quality of audits, improvement of supervisory activities for taxpayers.

Thanks to these measures, there should be an increase in the volume of tax revenues to the budget and maximize the fiscal function of the corporate income tax.

It can be summarized that the role of corporate profit tax in the consolidated budget of the Russian Federation is very great, for the calendar year 2023, the volume of revenues amounted to about 27%.

Literature

1. Results of the Federal Tax Service of Russia January-October 2023 // Federal Tax Service : electronic journal - 2023 URL: https://data.nalog.ru/html/sites/www.new.nalog.ru/2023/related_activities/statistics_and_analytics/effectiveness/10m23.pdf (accessed 14.03.2024)
2. Basics of Financial Literacy : Textbook for independent and classroom work / O. V. Vaganova, N. I. Bykanova, T. V. Saprykina, E. N. Pashkova. - Belgorod : Publishing House "BelGU", 2022. - 164 с.
3. Saprykina, T. V. Tax system of the Russian Federation / T. V. Saprykina, E. N. Pashkova // Vector of Economics. - 2021. - № 9(63).
4. Trunova, N. A. Operational report on the course of execution of consolidated budgets of the subjects of the Russian Federation January - June 2023 // Accounts Chamber of the Russian Federation : electronic journal - 2023 - URL: https://ach.gov.ru/upload/iblock/4a7/xieybd8n68pucaajdctqpw5fjqfetipf.pdf (accessed on 14.03.2024)
5. Federal Tax Service [website] URL: http://nalog.garant.ru/fns/nk/bd6b2fd2afacdc4c68f6b8e2571b5acc/#block_246 (date of address 14.03.2024)
6. Reports on the accrual and receipt of taxes, fees, insurance contributions, and other mandatory payments // Federal Tax Service [website] URL: https://www.nalog.gov.ru/rn48/related_activities/statistics_and_analytics/forms/ (accessed 14.03.2024)