Regional Tax Competition at Different Phases of Tax System Evolution in Russia

Abstract

The article is devoted to the analysis of tax competition as a phenomenon that began to rise with the transition of Russia to a market economy and manifested itself in different ways in the evolution of the national tax system. The analysis shows the features, reasons, scale and forms of tax competition prior, during and after the well-known Russian tax reform. Being an integral part of Russian economic reality, regional tax competition comes from fiscal federalism and changes depending on the tax autonomy of subnational governments. In addition, it is explained that unregulated tax competition can become harmful and lead to adverse economic consequences. The solution to the problem lies in the field of balance between regional tax autonomy and reasonable federal restrictions, promoting fair tax competition among subnational governments. Systematization of the path traveled plays a key role in many aspects, including understanding of the current tax legislation, harmonization of tax policy at the federal level, and improvement of regional taxation in Russia.

Keywords

• factors of production
• federalism
• regional competition
• tax base
• tax competition
• tax incentives
• tax policy
• tax reform
• tax revenues