In particular, the Russian government is taking a world lead amongst large countries in electronic processes. e-Registration to set up a business is long in place. Russia's anonymized and automated state tendering processes are a model of good practice also used by utilities and major state owned companies leading to a huge fall in corruption.
Alcohol distribution is now tightly controlled by an excise labelling process. Labelling of consumer goods with QR goods to detect authenticity of brands and compliance with quality standards is being rolled out sector by sector.
Tax submission has been simplified. It used to be that filing taxes every month meant visiting 3 or 4 separate offices across the city and having documents stamped at each. No more. Everything is online.
The reorganization of VAT in particular has been spectacular. No Russian firm now submits a VAT form. All invoice generating software and cash tills are connected to a central database which instantly records the transaction and the VAT due to be paid or refunded (slowly). This has huge knock-on effects. The Russian government can see the performance of the economy minute by minute, sector by sector. Corporate tax filings can be easily checked. VAT fraud has fallen from about 20% to less than 1%. For comparison, in the UK the fraud rate is about 9%. Mishustin’s success has led to other tax related projects such as
- a land registry to ensure all owners liable to pay Land Taxes can be traced.
- a forestry registry to reduce illegal logging
The goal is to have at least 90% of business and personal interactions with government administration done electronically with early focus on tax collection and social improvement. This month, the agenda for the Cabinet meeting will include discussions on such processes as
- applying for a nursery school place for a child
- applying for a passport
- applying for care for a sick relative
It is not just the government sector. The Russian private sector has been at the leading edge of some world developments in e-access. For example, Russian ATMs accept cash payments for a wide range of services for the unbanked. Russian banks were early to offer cell phone (not smart phone) based banking services. Russia expects the use of plastic cards to disappear by 2025 as Russian consumers switch to payment methods based entirely on smartphones using locally developed software.
Russia is a place to explore the latest in e-Processes that might affect your business in the future elsewhere in the world.