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Minister of Transport Maxim Sokolov reported to the meeting participants on passenger air and rail transportation volumes during the New Year holidays and over 2017. Head of the Federal Agency for Tourism Oleg Safonov reported on the growth of domestic, inbound and outbound tourist traffic. Minister of Finance Anton Siluanov spoke about the specifics of implementing the tax amnesty law. The participants also discussed the implementation of the Russian Seasons international project, which is held in Italy this year.

The main report on the progress with relocating citizens from dilapidated housing, classified as such as of January 1, 2012, was made by Minister of Construction, Housing and Utilities Mikhail Men.

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President of Russia Vladimir Putin: Good afternoon, colleagues,

I hope our winter holidays are over and we can sum up some results.

I looked at the references submitted by the Transport Ministry and I see an increase in passenger traffic over the recent period both by air and rail. Air traffic went up by 12 percent and railway traffic increased by about 7 percent. Mr Sokolov, go ahead, please.

Transport Minister Maxim Sokolov: Mr President, colleagues,

Allow me to report on the work of our transport system both during the New Year holidays and in 2017 in general.

According to the established tradition, air transport has the biggest appeal to passengers. Despite adverse weather conditions in the period from December 26 to January 8, about 4.5 million passengers travelled by air. This is a 12 percent increase over the corresponding period of last year. The airports of the Moscow aviation hub provided services to more than 3.2 million people (also a growth of 10 percent compared to last year). Vnukovo Airport set a record in this respect. It increased passenger traffic by over a quarter (26 percent), having provided services to 650,000 people. Sheremetyevo Airport provided services to 1.5 million passengers, and the figure for Domodedovo Airport is over one million.

Regional airport leaders are Pulkovo Airport (during the New Year holidays passenger traffic was about 570,000 people, which is an increase of 15 percent); Sochi (about 200,000 people – 30 percent higher over the New Year holidays compared to last year), Simferopol (120,000 people – an increase of over 35 percent) and Krasnodar (about 100,000 people – about 30 percent higher).

Outbound flights at all airports, including the Moscow aviation hub, were at their peak on December 30, and inbound flights peaked on January 8 when about 135,000 people flew to Moscow.

In all, about 700 charter flights from Russia were made during the holidays, including 400 flights from the airports of the Moscow aviation hub, which is 30 percent more than last year’s charter flights.

I would like to note that during the holidays none of the airports discontinued service even due to adverse weather conditions. There were some delays but nothing like what happened in America, in New York for one.

In 2017 Russian airlines transported over 105 million people. This is a record and 18–20 percent more than in 2016. Practically two thirds of the figure, or 62.5 million people, were domestic passengers (11 percent increase). International flights increased almost by one third (32 percent) and the number of tourists reached 42.5 million. The intensity of air traffic increased by 8 percent and average aircraft occupancy was higher as well.

Russian airports set a record by providing service to over 180 million passengers, including those travelling on international airlines. The airports of the Moscow aviation hub provided service to more than 88 million passengers. The figure for Pulkovo Airport was over 16 million, which is an increase of 22 percent.

I am pleased to say that apart from the airports of the Moscow aviation hub and St Petersburg’s Pulkovo, the five million mark was surpassed by four regional airports: in Yekaterinburg (over 5.4 million people), Novosibirsk, Sochi and Simferopol.

I would also like to note that according to the British analytical company OAG, last year Sheremetyevo was third among world airports of its category in keeping to flight schedules.

One of last year’s trends was the reduction of air travel costs – by an average of 11.5 percent on international flights (the cost of a return flight averaged 20,500 rubles) and by about 4 percent on domestic flights (return flights averaged less than 13,000 rubles). I am very pleased to mention this positive trend from last year.

Last year we also opened five major terminals. Platov Airport and the new terminal were built from scratch. Terminals in Anapa, Krasnoyarsk, Perm, Tyumen and Kaliningrad were opened using extra-budgetary funds. Airport infrastructure has been built in Volgograd, Yekaterinburg, Nizhny Novgorod, Samara and Saransk. A runway has been reconstructed in Kyzyl in the Republic of Tyva.

During the New Year holidays railways transported 38.5 million people, which is 7 percent higher than last year. In all, over 1.1 billion passengers were transported in 2017, an 8 percent increase over last year.

There has been modest growth in the number of long-distance trips and, I am pleased to say, commuter trips – an increase of about 9 percent. Here a record was set by the Moscow Central Circle that carried almost 1.3 million people during the New Year holidays, and about 140 million passengers during the year or over 290,000 people per day on average.

Last year Sapsan trains carried over 5 million passengers from Moscow to St Petersburg (an increase of 6 percent over last year) and about 200,000 people during the New Year holidays, which is an increase of almost 8 percent.

Russian Railways also offered New Year tours, for instance to Veliky Ustyug to visit Father Frost (not only from Moscow but also from other Russian cities: St Petersburg, Samara, Novosibirsk, Yekaterinburg and Tyumen). There were also tours to Kostroma – to visit the Snow Maiden, to Kazan from St Petersburg under the New Year in Kazan project and to Moscow from Novokuznetsk and Krasnoyarsk under the Moscow Vacation project. In all, such tourist “charter” trains carried over 8,000 passengers.

We have witnessed a considerable increase in other modes of transport in 2017, including freight traffic. I will report to you about it separately.

That concludes my report. Thank you for your attention.

Vladimir Putin: Mr Sokolov, do I understand correctly that railway transport volumes continue growing in the beginning of the year?

Maxim Sokolov: Yes, this applies both to railway and air transport. Online indicators for the first two weeks of this year point to the growth of both passenger and freight traffic in different modes of transport.

Vladimir Putin: Thank you.

Mr Safonov, judging by the Transport Minister’s report, internal tourism numbers in Russia should be growing.

Head of the Federal Agency for Tourism Oleg Safonov: Mr President, colleagues,

According to preliminary estimates, domestic tourism in 2017 increased by three percent and exceeded 56.5 million trips, which is 34 percent more than in 2014, and 75 percent more than in 2013.

During the New Year holidays, according to expert data, about seven million people went on tours in Russia. The average increase in this indicator by regions was nine percent from last year’s figures.

The geography of New Year travels also expanded. In addition to traditionally popular destinations such as Moscow (4.78 million tourists, up 13 percent), St Petersburg (430,000 tourists, up 10 percent), the Krasnodar Territory (596,000 tourists, up 19 percent), Tatarstan (130,000 tourists, up 18 percent), and Crimea (113,000 tourists, up 30 percent), a few other regions were discovered by Russian tourists. Among those are the Murmansk Region (33,000 tourists, up 10 percent), and the Chechen Republic (12,000 tourists, an increase of 140 percent).

Overall in 2017, Moscow received 21.5 million tourists (up 31 percent from 2014), the Krasnodar Territory 16 million tourists (up 16 percent from 2014), St Petersburg 7.5 million (up 19 percent), the Republic of Tatarstan 3.1 million (up 24 percent), the Republic of Crimea 5.4 million (up 35 percent from 2014), the Chechen Republic 130,000 tourists (up 249 percent from 2014).

It should be noted that the growth of domestic tourism has given a powerful impetus to the development of the hotel business in our country. In 2017, the number of hotels increased by seven percent compared to the previous year, and by 357 percent compared to 2000, that is from 4,200 to 15,000 hotels.

Over 14,000 themed events, including for families, took place across the country during the New Year holidays. Trips to Veliky Ustyug, which is where Father Frost lives, and New Year and Christmas festivals were particularly popular this year. For example, about 14.5 million visitors attended the Journey to Christmas festival in Moscow during that time, up 22 percent compared to last year.

Mountain skiing is traditionally popular with our people. Over 1.3 million vacationers went to ski resorts during the New Year holidays, which is 16.7 percent more than during the same period last year.

This year, skiers had a choice of 300 ski resorts or lodges in Russia with different levels of amenities, about 1,400 ski slopes, 800 cable cars and lifts. The average cost of a ski pass was about half of what one would normally be charged abroad. New slopes, lifts, and service centres opened in a number of regions this winter.

Skiing can be done in most parts of our country, including the Krasnodar Territory, Karachayevo-Circassia, Kabardino-Balkaria, the Kemerovo Region (Sheregesh Ski Resort), the Moscow, Leningrad, Murmansk, Novosibirsk, Sakhalin, Sverdlovsk, and Chelyabinsk regions, Altai, Kamchatka, Bashkortostan, Chechnya, and the Perm, Krasnoyarsk, Primorye and Khabarovsk territories.

Sochi ski resort set the record this time hosting over 358,000 visitors, an increase of 25 percent on 2016. Karachayevo-Circassia is also high on the list with 120,000 vacationers visiting its ski resorts, an increase of 50 percent compared to last year.

The winter tourist season continues. Russia is blessed with an extended ski season, since we can ski until late April.

Owing to the growth in the number of affordable offers, economic stabilisation, and increase in the purchasing power of the population, Russians have started spending their vacations abroad more often. In tentative estimates, the outbound tourist flow grew by almost 20 percent in 2017 to reach 38 million trips. Importantly, it approached the level of 2014 when our citizens made 42 million trips.

During the New Year holidays, Russians went to Thailand, the United Arab Emirates, Vietnam, India and Israel, to name a few. On the whole in the last 17 years the number of foreign trips by Russians doubled to reach 38 million as compared to 21 million in 2000.

Despite sanctions and propaganda against Russia abroad, we are witnessing an upsurge of interest in Russia among foreign tourists. According to the World Tourism Organisation, Russia is among the top five countries in online searches. And according to expert estimates, inbound tourism to Russia grew by 6–8 percent in the first ten days of January. The Border Guard Service of the Federal Security Service registered a 14 percent increase in inbound tourism in the first three quarters of last year compared to the same period in 2016.

Russia’s appeal among foreign travellers has increased following the introduction of online visa processing in Russia’s Far East and the introduction of the tax-free system.

We have started preparing for the high summer tourism season, paying special attention to the 2018 FIFA World Cup. One of the most important tasks now is to complete the planned measures to upgrade tourism infrastructure in the cities hosting the World Cup, create a comfortable environment for tourists and carry out regional hospitality programmes. The latter will help reveal the tourism potential of the World Cup and consolidate the positive international image of this country as a world tourist destination.

That concludes my report. Thank you.

Vladimir Putin: Thank you.

Mr Medinsky, Russian Seasons opened in Italy the day before yesterday.

Minister of Culture Vladimir Medinsky: It is our most successful project. Last year, Russian Seasons premiered in Japan with about three million spectators attending concerts and performances featuring our artists.

This year, in Italy, we expect about the same attendance. Russian Seasons in Italy will cover all arts, including opera, ballet, exhibitions, circus shows, and even the world championships, if I am not mistaken, of military reenactors (jousting), and, of course, cinema. We are making major preparations for the Venice Film Festival with the Russian-Italian film Michelangelo.

Russian Seasons was opened at the highest level by Ms Golodets. We hope that this project will be no less successful, including politically, from the point of view of maintaining the special relations Russia and Italy have traditionally enjoyed.

Vladimir Putin: Ms Golodets, you led the Russian delegation.

Deputy Prime Minister Olga Golodets: Yes, Mr President, the public was amazing. I would very much like to thank the people behind the opening ceremony for the Russian Seasons both from Italy and, of course, Russia. Everyone did a great job. The audience was great, too. The place was crowded, and the applause went on and on. The house was full, and when we wanted to get 10 extra tickets at the last moment, we were unable to get any.

Russian Seasons opened with two symphonies by Tchaikovsky performed by the Mariinsky Theatre Orchestra led by Valery Gergiev. Everyone – both the media and the public – were unanimous in their opinion that such a level of performance of these pieces in this auditorium was unprecedented.

The superiority of Russian culture today is so obvious that the Russian Seasons project itself is highly valued. We had meetings with our colleagues from the political elite. Honorary President of Italy Napolitano, Ms Boschi, who represented the Government of Italy, and about 150 members of the Italian elite attended the opening. They all agreed that our cultural ties should continue and rise to a new level, including thanks to such an excellent project as this.

Our Italian colleagues agreed to act as special guests at our upcoming cultural forum and an agreement was signed between our countries to that effect. Italy has shown its commitment to promoting all areas of cultural cooperation. So, the project was a success.

Vladimir Putin: In autumn, a reciprocal event will take place in St Petersburg. It will not be on such a large scale but nonetheless we must prepare for it and help our Italian partners.

Olga Golodets: We will do everything.

Vladimir Putin: Mr Siluanov, I have asked you to draft and implement a law on writing off overdue tax debts of citizens and individual entrepreneurs. Go ahead, please.

Finance Minister Anton Siluanov: Yes, Mr President, you set three tasks. First is writing off overdue tax debts of citizens and individual entrepreneurs. The second task is exemption from a tax on land (600 square metres) for certain categories: people with disabilities, war veterans and heroes to name a few.

Vladimir Putin: Old-age pensioners.

Anton Siluanov: Yes, pensioners as well.

And the third task is not to levy tax on incomes that have arisen as a result of writing off debts to banks or on utility fees because according to current law such sums are taxed.

The relevant law was drafted and adopted last December. This law provides for writing off property tax debts. In the estimate of the Taxation Service, it concerns over 20 million people. Their total debt is 41 billion rubles.

As for individual entrepreneurs, their debts under special tax regimes, simplified taxes, unified tax on imputed income and patent payments have been also written off. The total figure amounts to 15.8 billion rubles and concerns about three million individual entrepreneurs. Importantly, taxes were written off as of January 1, 2015.

In addition, we included in the law a provision on writing off insurance premium debts for individual entrepreneurs that did not present financial reports as of January 1, 2017. According to the Taxation Service, this concerns about 700,000 individual entrepreneurs and their total insurance premium debt amounts to 127 billion rubles – a substantial sum.

Importantly, Mr President, these debts have been and will be written off without taxpayers – citizens or individual entrepreneurs – having to contact tax agencies. In other words, these debts will be written off directly by the Taxation Service.

As for the exemption from land tax (within the limit of 600 square metres) for certain categories of citizens, this norm has been valid since January 1, 2017. In other words, these categories of citizens will not have to pay this tax for the previous year. This is the norm that is envisaged by the law.

Vladimir Putin: So, what we are doing essentially applies retroactively?

Anton Siluanov: Yes, retroactively. As for contingent gains, debts will be written off for about two million people, totalling about 22 billion rubles.

Importantly, using this law that was drafted in line with your instruction has freed citizens and individual entrepreneurs from debt. In effect, their debts were eliminated. But it is also important to remember that current taxes must be paid in accordance with current legislation. The Taxation Service has considerably simplified tax payment procedures as compared to 2015 (when we wrote off these debts). Now it is possible to pay taxes through user accounts, without visiting the Taxation Service office. At any rate, we hope and believe that the current debts will not be accumulated and all obligations to the budget, to the treasury will be met in accordance with current legislation. Thank you.

Vladimir Putin: Okay, thank you.

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