On increasing the degree of progressiveness of the income tax in Russia

Abstract

Income tax fulfills not only fiscal, but also social and regulatory function in the economy. Currently, the main burden of paying income tax in Russia is borne by workers with low and middle incomes. In order to increase the social function of the income tax, it is necessary to continue reforming it in order to achieve greater progressiveness. The overall progressiveness of income tax depends on the structure of all tax categories, exemptions and deductions, and not only on the difference between the maximum and minimum rates. As shown in the article, Russian tax legislation does not provide for a lower income threshold that is exempt from income tax, and the amount of tax deductions for children does not provide meaningful support to families. When changing the parameters of income tax, an integrated approach is important, taking into account the possible consequences in the form of a drop in income of regions especially sensitive to this type of tax.