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Today in Russian Business – Dec 1, 2010

Small businesses in certain sectors will be given a two-year transition period to higher rates of payroll taxes, says President Dmitry Medvedev, amid concerns that many would not otherwise be able to cope with the new rates.  As part of preparations for Russia’s accession to the WTO, the country could eliminate overflight charges to European airlines which, by EU estimates, currently cost around $200 million a year.  Abu Dhabi’s state investment company is marking its excitement about the Russian market with a $100 million investment.  That’s a relatively tiny drop in the ocean of $25 billion in anticipated capital flight from Russia this year, more than double the figure predicted by the Kremlin in October.  The central bank says it is too early to raise interest rates whilst economic recovery remains fragile.  From Vedomosti: ‘It is entirely possible for criminal businesses to evolve — to grow in scope, to acquire new property, and to come to the realization that it is more advantageous to make money legally.‘