Kamchatka tax officials looking into repercussions of softer tax regime for fishery industry
Kamchatka's Department of the Federal Tax Service has conducted the first meeting of the province's Anticrisis headquarters in order to analyze the situation with the inflow of the tax disbursements from the fishery sector, reports www.fishnet-russia.com (www.fishnet.ru) with reference to Fishnews.
The province's economy has been historically based on the fishery industry. In 2008 the province's companies harvested 732,500 tonnes of fish, accounting for 20% of Russia's total harvest, and the value of landed seafood of own production exceeded 17 billion RUB, 10% up on 2007.
According to Kamchatka's tax officials, in 2008 there were 185 tax payers engaged in fishery activities and registered in the local tax department. Eighty-seven companies belonged to the category of the largest and the most important tax payers. However, despite the rise of the catch rates the inflow of the tax disbursements to the province has decreased.
More specifically, while from 2005 to 2007 the inflow of taxes and tallage from the fish businesses grew from 2.1 billion RUR to 3.1 billion RUR (less single social tax), in 2008 the province's fish businesses disbursed only 1.6 billion RUB. Correspondingly, the industry's contribution to the province's tax disbursements has decreased from 23.3% to 13.3%.
The main reason behind the decrease is the change in federal legislation, namely changes in the fees for the stock exploitation. For instance, the fee for snow crab exploitation has come down from RUR60,000 per tonne to RUR13,000 per tonne and the red king crab fee has gone down from RUR100,000 to RUR35,000 per tonne.
Besides, if earlier a 15% resource fee for the stock exploitation was given only to fishing artels and co-ops, starting from 2008 such right has been given practically to all fishing companies. As a result, such disbursements have decreased from RUR1.9 billion to RUR396 million.
The diminished pay for exploitation of biological resources could have resulted into a rise of the companies' efficiency, however in 2008 disbursements of the profit tax amounted to RUR61 million versus RUR311 million in 2007. Moreover, the province's largest fish businesses reported losses last year. The average wages in the fishery industry in 2008 made RUR32,400 per month, though small companies harvesting up to 1000 tonnes of fish reported official wages of less than RUR9000 per month.