Tax by rocker

The Ministry of Finance confirmed the right to free use of groundwater in private lands

Summer residents and owners of private houses, even in the driest regions of Russia, are not in danger of thirst: the Ministry of Finance has officially clarified that drawing water from domestic wells is not subject to water tax. We are talking only about wells and boreholes located directly on private property. If the aquifer is used for centralized water supply, then a license must be obtained for such water intake with all the ensuing (literally and figuratively) tax consequences.

The relationship between summer residents and water has long been complicated in Russia: digging your own well or borehole has always been an expensive pleasure. But using a common village well or a well of a gardening partnership for personal purposes is also not free: you need to pay money for its maintenance, despite the fact that the amount of water taken from the common well is under the vigilant control of neighbors. In order to save common water, residents of a garden community or village closely monitor how often their neighbors heat the bathhouse and how often they water the beds. The highest level of neighborly indignation is caused by construction started by one of the villagers: mixing cement takes many times more water than for domestic consumption.

Against the backdrop of these problems, constructing your own well seems to be a worthy way out of conflicts with neighbors. However, the summer residents who dug wells suddenly realized that a conflict was brewing from the other side - regarding the tax authorities. The Water Tax , adopted in 2005, as well as the Water Code , which entered into force on January 1, 2007, established that the use of water by all residents of the country is not free. For summer residents, however, they made an exception, allowing them not to pay for water intake from their own plots and from public wells. However, whether summer residents and villagers are taxpayers required to file returns has long remained an unresolved issue.

Two years ago, after the chapter of the Tax Code on water tax came into force, regional departments of the Federal Tax Service (UFTS) were forced to provide explanations to summer residents about how and who should pay for water. Most of the Federal Tax Service, including the Federal Tax Service for the Moscow Region, explained that the taxpayer’s submission of a tax return for water tax is mandatory, even if water is withdrawn only for irrigation and is not subject to taxation. The obligation to submit a tax return for water tax was determined not by the availability of the amount of such tax to be paid, but by the provisions of the law on this type of tax.

The Water Code that came into force did not fully clarify the situation. Formally, the tax authorities could oblige the owners of dachas, garden plots and houses in the village to report the tax, since the withdrawal of water from domestic wells and wells from the first aquifer below the surface is not included in the list of water use objects that are not recognized as objects of water tax.

Then the Ministry of Finance decided to intervene in the situation. Officials of the financial department in letter No. 03-06-05-02/12 confirmed that water withdrawal from domestic wells and wells from the first aquifer from the surface is subject to water tax only if such an aquifer is used for centralized water supply. Such water intake is subject to licensing. Taxpayers of water tax are organizations and individuals engaged in special or specific water use. But owners of summer cottages and houses do not have to file declarations and pay taxes, the Ministry of Finance explained.

Obtaining a license for water use is not required and taxes are not levied when drawing water from single wells and wells using household pumps equipped by owners and users of land plots, when using the first aquifer from the surface. The object of taxation under the water tax is also not recognized as the intake of water for watering horticultural, gardening, dacha land plots, land plots of personal subsidiary plots, the intake of water for watering and servicing livestock and poultry owned by citizens.

Irina SKLYAROVA