Tax Incentives for Energy Efficient Investments in the Context of Neo-Industrial Paradigm in Russia

Abstract

1. Introduction 1.1 Introduce the Problem Increase of energy efficiency and energy saving are important on a global scale. And the reason lies in not only limited resources, but also in increasing negative impact of emissions on the environment and climate. National economies are interested in preservation of natural potential for future generations, reduction of production costs by decreasing the share of consumed energy and fuel resources and increasing the manufacturing with high added value. This can be realized in two main ways. Firstly, through changing the fuel balance by using less dirty technologies and alternative energy sources. Secondly, through wide implementation of energy-saving technologies and water/wastewater treatment facilities. Implementation of these measures is associated with high costs. However, business in modern Russia lacks both own funds and borrowing assets due to high interest rates. In addition, it does not have enough stimulations in market economy to expand costs when there are cheaper ways to get results. The government must provide its citizens with public benefits and it has necessary financial resources for that. Therefore, it must take on costs of the energy efficiency of the economy, including tax expenses. Developed countries solve these problems by increasing the tax burden for the production and consumption of energy and fuel resources, implementing environmental taxes and stimulating energy production from renewable sources of energy. In countries with developing economies a greater share of the industry is occupied by high-energy demanding spheres. Rise of taxes and cost of energy to the world level may have a limiting effect on economic growth. Model of resourcebased economy and de-industrialization of the Russian economy on the background of financial crisis significantly complicates the task of construction of an effective mechanism of tax incentive for energy efficient investments, and as a result, for environmental efficiency. Neoindustrialization requires implementation of major projects and improvement of power loading in a number of sectors of the economy with the aim of increase of share of import-substituting industries with high added value. 1.2 Explore Importance of the Problem The importance of the study of tax incentive for energy saving and increase of energy efficiency within a neo-industrial paradigm is conditioned by a need to study both its theoretical base and practical recommendations. The need for, on the one hand, increase of industry capacities, and, on the other hand, for compliance with the Kyoto protocol and reducing of harmful emissions into the atmosphere, requires special attention of the government to the formation of tax policy in this area. Currently, the existing tax legislation in Russia has only three preferences aimed at the investments in facilities exclusively with high energy efficiency. Only fuel resources are listed as excisable, which has no significant limiting effect on demand and consumption of objects with high energy efficiency. Negative impact on the environment are charged with fees of non-tax nature. It does not bear any fiscal or regulatory role due to unessential size and a number of disadvantages concerning calculation pattern and payment (Koroleva & Maskaeva, 2014). In 2015, the tax maneuver was implemented. It is aimed at increasing of cost of fuel and energy resources in the national market by increasing environmental taxes and reducing export duties. This measure will reduce the profitability of main customers in heavy industrial manufacturing. But is does not stimulate technological upgrades in order to save resources of the mining industry itself. In the Russian Federation it is necessary to form a complex system of tax measures aimed at improving the energy efficiency of industrial manufacturing, allowing to have a double effect. Ecological one--by reducing harmful emissions into the atmosphere, economical one--by increasing the rates of economic growth based on resource saving. …