Tax Investment Incentives: Worldwide Experience and Russian Practice

Abstract

Purpose: the main purpose of the work is research of the applying foreign tax experience to stimulate investment in the Russian business environment, taking into account the special role of the tax system in the national economy, it can be as both a factor in creating threats of the economic security and a resource for its provision. To achieve this goal in the article you must accomplish the following tasks: to perform systematization and critical analysis of theories, empirical research and foreign experience in applying tax incentives to attract investments; to identify the features of the tax relations of the state and business and features of the use of tax incentives in the Russian business environment.Methods: methods of systematic, logical and comparative analysis of the scientific literature were used, an analysis of descriptive statistics was carried out taking into account the assessment of hierarchical and correlation dependencies between empirical data.Results: numerous empirical and theoretical studies on the effectiveness of tax incentives as a tool to increase the investment attractiveness of a territory contain extremely contradictory conclusions. The effectiveness of the application of tax benefits differs depending on the conditions of doing business in the jurisdiction. There is no consensus about the effectiveness of tax benefits, the findings of scientists differ depending on the countries and methods. However, despite numerous criticisms, tax incentives remain a popular policy tool for attracting investment in developed, transitional and developing countries.Conclusions and Relevance: tax relations are essentially multidimensional, complex, and their social, political and legal content is initially conflicting, which determines the need to find a balance between the interests of the state and business. The effectiveness of their practical application to attract investment in the Russian reality is increasing in combination with other non-tax factors, such as business conditions, infrastructure, management quality and institutional environment.

Keywords

• tax incentives
• tax burden
• foreign direct investment
• investment climate
• investment attractiveness
• economic security