”” published opinions of Natalia Kornienko, Head of Tax System Development Department of the Gaidar Institute, on the introduction of a single tax account for all taxes, duties and insurance premiums for legal entities and individual entrepreneurs.

The Federal Tax Service (FTS) plans to extend the effect of the institution of a single tax account (STA) to individual entrepreneurs and organizations. This follows fr om the terms of reference published on the public procurement website. So far, the single tax payment mechanism is available only for individuals.

Since 2019, Russians acting as individuals can apply a simplified mechanism for paying property and transport taxes, and from 2020 they can pay PIT in advance. A single tax account is something like an electronic wallet wh ere any individual can voluntarily transfer a certain amount in advance to pay tax liabilities.

The contribution can be made at one’s earliest convenience throughout the year, while tax authorities will offset the payment.

It is a comfort for taxpayers, since they do not have to overthink about complicated calculations, get confused in banking details and worry about everything coming exactly down to the last penny. It is sufficient to deposit an estimated amount into a single account and then the state will allocate payments for each of the taxes exactly as intended. This way, one can avoid unwanted penalties in case of accidental delays or technical errors due to confusion in the endless KBK, OKTMO, BIK and other numerous abbreviations needed for money to go to the required current account.

Such technologies are actively becoming part of our life and they represent our future. Technologies that resemble our single tax account already exist somewhere. Thus, for instance, the single payment mechanism applying to taxes of both individuals and legal entities, operates in Sweden, Italy, and from January 1, 2021, in Latvia, as well as in some other countries. This technology has not been widely spread due to only one reason: it requires solid intellectual developments in the digital workflow of the tax service.

Regretfully, not every country is able to afford this. In addition to guaranteed accuracy in tax payments and comfort for taxpayers, such systems significantly reduce overall costs.

First, the burden on the information systems of the FTS is reduced when administering tax revenues to the budget. Second, reduction of working time for tax calculations, filling out and filing of declarations is a direct benefit to enterprises. Well, third, and this is important, thanks to the establishment of trusting relationships between business and the tax service, the state economy is being whitewashed.

It is true that there are pitfalls in every business. Therefore, it is important that the tax service remembers to provide taxpayers of all categories with a feedback system with tax authorities when introducing the STA system for enterprises. This is, first of all, the ability to quickly correct mistakes (and it does not matter who committed them, the tax system or the taxpayer), which actually means closer interaction between the taxpayer and tax officials, including in the online mode.

Actually, a lot still needs to be done in order the new mechanism could operate. In particular, norms of the Tax Code of the Russian Federation dedicated to liability for delays or non-payment of taxes due to technical reasons, should be amended. Formally, the "Roadmap" for the STA development provides for such changes, however, it should be more clear and transparent for all groups of taxpayers. Moreover, if the extension of the STA to all types of taxes, fees, and even insurance premiums is taken into account, it is necessary to accurately and clearly explain the responsibility well in advance in order to diffuse mistrust both on the part of “individuals” and legal entities.

However, so far, the FTS has only announced a competition to develop a concept for the introduction of the institution of a "single tax account". The developers still have time to polish it until the end of 2022.