Russian Parliament is pondering the proposed inclusion of domestic telecommunication equipment manufacturers in the so-called “tax maneuver” for the IT sector, the USRBC reported, citing a Russian media source.

The “tax maneuver”, which is to take effect in January 2021, is meant to reduce Russian IT firms’ social security contributions from 14% to 7.6% and federal profit tax from 20% to 3%. It also abolishes the regional profit tax for domestic IT firms. At the same time, the measure re-imposes a 20% VAT on certain software products.

The initiative would benefit certain types of domestic telecommunication equipment including routers and wireless modems. According to the Russian Association of Electronic Equipment Producers, domestic equipment accounted for about 18% of Russia’s $4bn telecommunication equipment market in 2019.