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President of Russia Vladimir Putin: What is your progress status and collection rate to date?

Head of the Federal Taxation Service Daniil Yegorov: With your permission, I will begin with the overall budget system revenues. [In the first seven months of 2025], we recorded a 7 percent increase – equivalent to an additional 2.4 trillion rubles in total taxes and fees.

Turning to the federal budget specifically, growth stood at 5 percent. Notably, the key driver was non-oil and gas revenues, which rose by 27 percent, contributing an extra 2 trillion rubles.

Across industries, the manufacturing sector is performing very well, contributing almost half a trillion rubles, alongside the financial sector, construction, and trade. The IT industry is also in the top five.

Vladimir Putin: The construction volume seems to have dwindled, but nonetheless…

Daniil Yegorov: Indeed, the dynamics are a little down. Nevertheless, they are still among the growth leaders.

At the same time, we have adopted a flexible approach in areas facing ongoing challenges. Specifically, following your instructions, we granted deferrals totalling 7 billion rubles to companies in the Kursk and Belgorod regions. The coal sector also received deferrals of 47 billion rubles. This reflects the FTS and Government’s flexible approach – as you directed, tax support is being prioritised where it is needed most.

Turning to this year’s reforms – and these are indeed significant changes – I can confirm our full readiness. On income tax, we have successfully transitioned to the new progressive tax scale, marking our first key milestone.

Secondly, we have implemented an integrated tax deduction system. Notably, higher standard deductions will benefit 15 million taxpayers, providing approximately 35 billion rubles in relief. The entire framework is now operating smoothly.

Last but not least, we are fully prepared to implement what we call the social deductions initiative. Under this programme, families with two or more children will benefit from a reduced personal income tax rate of just 6 percent. We have already conducted system testing using available data in collaboration with the Social Insurance Fund, with implementation scheduled for next year based on current income levels – I mean this year’s income.

One of our most technically complex initiatives has been implementing a simplified taxation scheme for VAT on turnover up to 60 million rubles. We have taken comprehensive preparatory measures – educating taxpayers, establishing information systems, and even waiving late filing penalties and transaction suspensions during the transition period, expecting some taxpayers to experience difficulties adapting. However, by the end of the first quarter, just 2 percent of the 180,000 affected taxpayers missed their filing deadlines, and we are already engaging with these cases individually. That is, in general…

Vladimir Putin: The system is working.

Daniil Yegorov: The entire framework is operating smoothly.

Finally, under the July reforms, we were granted the authority to assess companies’ financial health. Our response? We developed a system enabling counterparties to evaluate each other’s standing. Essentially, businesses can now request their financial data from our office and share it with partners so they can see their financial standing. This comprehensive assessment covers over 50 parameters. Notably, during the pilot phase alone, more than 40 percent of state contracting already utilised this scoring mechanism.

Vladimir Putin: This definitely enhances stability.

Daniil Yegorov: Yes. As a result, just 0.6 percent of contracts under this scoring system ultimately get terminated.

Vladimir Putin: This is very good. Thank you.

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