Flat Tax Russia

About Flat Tax Russia

Russia replaced its progressive income tax with a 13 percent flat tax in 2001. The reform was dramatic, replacing rates ranging from 12 to 30 percent with a single low rate. The Russian flat tax was closely watched by economists. Initial reports suggested that revenue increased dramatically after the reform, apparently vindicating Laffer Curve arguments. However, later analysis showed that much of the revenue increase was due to improved collection and economic growth rather than the flat tax itself. The Russian flat tax influenced tax policy debates worldwide. Several Eastern European countries adopted flat taxes after Russia. Russia has since reintroduced progressive elements, adding a 15 percent rate on high incomes in 2021.