Russian lawmakers approve an increase in income taxes for the wealthy

The Russian parliament’s lower house gave final approval Wednesday to a bill that would raise income taxes for the rich, in a move to help fill government coffers during the fighting in Ukraine.

The bill, which was endorsed in the final third reading by the State Duma, needs to be approved by the upper house and signed by President Vladimir Putin to become law.

The legislation, which envisages a progressive tax on personal income, is a major change of course from the flat-rate tax that was widely credited with improving tax collections after it was introduced in 2001.

The bill would impose a 13 per cent tax for incomes of up to 2.4 million rubles (USD 27,500) a year. For incomes over that amount, a steadily higher tax rate would apply, with the maximum rate of 22 per cent for incomes exceeding 50 million rubles (USD 573,000).