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A Meeting of the Real Estate Committee of the Chamber of Commerce and Industry Was Held

21 April 2015

A regular meeting of the Committee for Entrepreneurship in the Sphere of Real Estate Economy of the Chamber of Commerce and Industry of the Russian Federation took place. Philipp Ryabchenko, a member of the Committee, took part in the discussion on taxation in the sphere of commercial real estate. The main topic of the discussion was the use of the new rules for determining the tax base as a cadastre value. The agenda was to consider the influence of cadastre value-based taxation of commercial real estate on business, give an overview of the existing practices analyzing the growth of the tax load on business and influence of rental rates, appraise prospects and problems of the accuracy of the conducted cadastre appraisal, and consider both the ratio of the cadastre and market price of properties and challenging the cadastre value of commercial real estate in relevant judicial practices.

All parties concerned participated in the event. Bodies of power were represented by Natalia Markevich, General Director of the Center for Tax Revenues, Maria Bagreeva, Deputy Head of the Department for Economic Policy and Development of Moscow and the Head of the Office for Financial and Tax Policy, and Mikhail Sergeev, Head of the Office for Taxation of Personal Property and Incomes of the Federal Tax Service of Russia. Business was represented by executives of major shopping and administrative business centers, such as Aerobus Shopping Mall, IMMOFINANZ Group (Golden Babylon chain of shopping malls), PPF Real Estate Russia (a company engaged in commercial real estate development), Reutov Park Shopping & Amusement Center, and Schuka Shopping & Amusement Mall.

Speeches were delivered by Maria Bagreeva and Mikhail Sergeev, and also by Alexander Kanshin, Chairman of the Committee for Entrepreneurship in the Sphere of Real Estate Economy of the Chamber of Commerce and Industry of the Russian Federation; Nikolai Volovich, Director of the Institute for Appraisal of Property and Financial Activities; Alexei Kozyrev, Expert for Decreasing Cadastre Value of Real Estate and Director of Kozyrev Law House; Natalia Krivova, Director of the Institute for Problems in Registration, Appraisal and Taxation of Real Estate; Viktor Zhurba, Deputy Chairman for Appraisal Activities and Information Support of the Real Estate Market, as well as executives of shopping and office centers of Moscow and the Moscow Region.

It was noted in the course of the discussion that the tax load on owners had significantly grown due to the tax reform. The tax has increased almost eightfold for some owners. In the meantime, there was no such growth for owners of new properties where the balance sheet value was close to the maximum. Philipp Ryabchenko, Senior Partner of BIEL, took part in the discussion at the regular meeting of the Committee of the Chamber of Commerce and Industry of the Russian Federation.