Investigating and developing methods for stimulating innovative and investment activities applying taxation tools

Abstract

Background/Objectives: In Russia considerable financial resources are required for transition to innovative development. The objective of this study is to develop taxation tools focused on stimulating innovative activities. Methods: Theoretical and methodological basis of the investigation is represented by the concepts suggested in the works on innovations belonging to domestic and foreign authors; legislative and regulatory documents that control innovative activities; articles in periodic press and official statistical data. The study makes use of methods and techniques as follows: statistical methods of grouping and generalization, methods of systemic and comparative analysis, synthesis and formalization. Findings: It has been justified that the higher level of innovative development determined by the global innovation index is a characteristic feature of the countries where the tax load on individuals is high and the tax load on legal bodies is low, especially, in terms of the insurance premiums payable to the funds that considerably affect the prime-cost of innovative products. The suggested proprietary algorithm helps stimulate operations of the innovatively active companies that practice expansion and the efficient use of their production capacities as a consequence of adjusting the tax rates within the framework of regional taxation system that results in lower tax load. The algorithm has been developed for calculating the costs for the business-process stages based on applying principal forms of innovation funding and facilitating the improvement of innovative activities in the companies due to engaging financial resources for the purposes of innovative project implementation. Applications/Improvements: Theoretical significance of the study is represented by adjusting the tax rates to stimulate innovatively active companies. Practical significance is manifested by applying financial tools to implement innovative investment policies.