Demand of organizations for accelerated return of capital investment in profit taxation in Russia

Abstract

We analyze how actively Russian organizations apply the right to accelerate the return on capital investments when calculating corporate profit tax in federal districts. The emphasis of the study is placed on such an accelerated asset write-off tool as depreciation bonus. The investment climate of the Russian regions is reflected both in the size of investments and the dynamics of investment activity of organizations, and in the instruments used for direct and indirect stimulation of capital investments. For organizations, these incentives are expressed in terms of the corporate profit tax burden. Significant differences were shown by federal districts, by the absolute amount of the accrued depreciation premium, by the number of organizations using the right to it, and by relative indicators: depreciation premium per organization, the share of organizations that use this tool to reduce tax liabilities, tax savings on profit. The result of the study was confirmation of a positive relationship between the share of investments to which the depreciation premium was applied and the corporate profit tax burden, which may explain the unevenness in using accelerated depreciation methods for tax purposes.