Tatiana Khoreva in CRE Magazine


Since January 1, 2014, commercial property tax is calculated on the basis of cadastral value which is close to the market value. CRE Magazine discussed the growing tax burden with the leading industry experts.

In certain cases, the change in the property tax calculation procedure has resulted in a multifold growth of tax burden. Tatiana Khoreva, Deputy Head of the Representative Office of RD Group Investment and Development Holding, has commented on the situation for CRE Magazine:

“Today property tax is calculated on the basis of cadastral value of the property, which is close to the market value, and not on the basis of balance sheet value. However, the adoption of the new tax calculation procedure on the basis of cadastral value took place over a short period of time, and the market faced certain difficulties. A part of one-type commercial projects (business centers, shopping centers) in different city areas was evaluated lower than their owners expected, while the other part was evaluated higher. The overall property tax increase was insignificant to their business and did not exceed 5-7%.”

Tatiana also noted, that many companies faced situations when one-type commercial spaces located in the same district of Moscow were overvaluated, and sometimes by a factor of 10-20. According to Tatiana, in this case, developers may choose to contest cadastral value by means of the applicable legal procedures.

In view of the current economic environment, Opora Rossii proposed the Moscow City Government to temporarily limit the tax rate growth at the level of 20%.