Four local companies receive industrial complex status

Four local companies receive industrial complex status
Photo: Photo by the Mayor and Moscow Government Press Service. Denis Grishkin
These companies will receive profit-tax, land-tax and property-tax breaks, as well as reduced rates for their land plots.

Four major local companies affiliated with the textile, pharmaceutical and food industries and employing about 1,500 workers have received industrial complex status at a meeting of the Moscow Government Presidium.

“Therefore, with due consideration for the proposed decisions, the city will have 22 operational industrial complexes and 27 technology parks that have invested over 60 billion in their own infrastructure over the past five years,” Moscow Mayor Sergei Sobyanin said.

The city’s technology parks will provide almost 38,000 high-tech jobs by the end of the year.

“If we look at technology park statistics, we’ll see that, taking into account today’s decisions, the area of technology parks’ land plots and their floor space of their buildings will total 580 hectares and almost two million square metres, respectively. The number of jobs they provide will reach 38,000. But their growth is the most interesting thing. The number of technology parks has increased by 70 percent throughout 2016 compared to 2015, with the area of their land plots and their floor space increasing by 25 percent and 84 percent, respectively. At the same time, the number of high-tech jobs at these facilities has soared by 165 percent,” said Oleg Bocharov, Head of the Department of Science, Industrial Policy and Entrepreneurship.

Start PLC, a leading textile company producing children's clothing, has received industrial complex status. Start makes school uniforms, trousers, shirts, blazers, classic suits, sport suits, hoodies, long belted blouses, tuxedos, tail-coats and vests. The company is located at 9 Velyaminovskaya Street in the Eastern Administrative Area.

Its land plots have an area of 0.56 hectares, plus 17,400 square metres of floor space. The company employs 113 people, with average monthly salaries of 40,180 roubles. Production-expansion investment volumes have reached 18.1 million roubles over the past five years. In the next five years, the company is set to upgrade its power supply and water supply/drainage networks and its production equipment, and replace various elements of the automatic fabric-cutting system.

The Moscow Endocrine Plant (www.endopharm.ru), a major national pharmaceutical manufacturer, has also received the new status.  The plant produces 70 percent of pain-killers and analgesics being used in Russia, including by the Russian Armed Forces, the Interior Ministry and other law enforcement and security agencies. The company is affiliated with the Russian Ministry of Industry and Trade and is located at 25 Novokhokhlovskaya Street in the Southeastern Administrative Area.

“The company employs almost 1,000 people manufacturing 80 different products,” Mr Bocharov said.

The company’s land plots have an area of 1.17 hectares, and its floor space totals 16,200 square metres. The plant employs 816 people, with average monthly salaries of 71,040 roubles. Over the past few years, 752.4 million roubles have been invested in corporate development projects. The company is set to upgrade and retool facilities for manufacturing injection solutions and laboratories of quality control divisions, and a new unit with production facilities, laboratories and warehouses is also scheduled to be built.

The Ostankino Baranka Plant (www.ozbi.ru), Russia’s only company turning out Baranka and Sushka ring-shaped crackers, has also received industrial complex status. The company, which also manufactures bread sticks and cookies, is located at 11 Ogorodny Proyezd in the Northeastern Administrative Area. Its land plots have an area of 1.76 hectares, plus 13,000 square metres of floor space. The company employs 331 people receiving an average monthly salary of 37,460 roubles.

In the past five years, corporate development projects have received 377.4 million roubles. Short-term plans include the comprehensive reconstruction of steam boilers and the power supply network, the modernisation of three Baranka production lines, a feedstock-processing section and modernisation of a warehouse for storing, transporting and dispensing flour without any crates and containers.

East Balt Rus Ltd. (www.eastbalt.ru), part of the world-famous East Balt Inc. bakeries chain, became the fourth company to receive industrial complex status. The plant is a McDonald’s partner, supplying burger rolls, muffins, frozen patties with filling, syrups, sauces and other items. It is located at 3 Novoorlovskaya Street in the Western Administrative Area.

Its land plots have an area of 2.96 hectares, plus 12,200 square metres of floor space. The company employs 194 people, with average per-capita salaries of 72,818 roubles. In the past five years, corporate development projects have received 432 million roubles. Its ammonia-refrigeration unit will soon be replaced with a cascade Freon/carbonic-acid unit, a gas boiler unit and a new bakery will also be built, and the company's power supply networks will be upgraded.

The Eleron Special Research & Production Association (www.eleron.ru) has received technology park status and the status of the technology park’s management company.

“There are plans to grant technology park status to the company Eleron, Russia’s largest association developing and manufacturing security systems,” Mr Sobyanin said.

Corporate clients include the Russian Government, the Moscow Government, the Bank of Russia, the Moscow Kremlin’s Museums, the Pushkin State Museum of Fine Arts and others.

The Eleron technology park is located at 14 Generala Belova Street in the Southern Administrative Area. Its land plots have an area of 4.25 hectares, plus 77,100 square metres of floor space. The technology park employs 5,841 people, with average per-capita salaries totaling 61,427 roubles monthly. In the past five years, corporate development projects have received 257.6 million roubles. It will soon replace worn-out equipment with modern equipment featuring a computerised control system.

“There are also plans to grant anchor resident status to the company Abi Production, an anchor resident of Otradnoye technology park and a major developer of translation/linguistic software,” Mr Sobyanin added.

Moscow now has 22 industrial complexes and 27 technology parks employing 66,500 people and receiving tax breaks. In the past five years, these companies have channeled 63 billion roubles into production expansion projects.

The city has established a comprehensive system for supporting companies and investors in the real economy/production sector. Incentives and support measures include various profit tax, land tax and property tax breaks, as well as reduced land-lease payments. These breaks allow companies and investors to pay 10–25 percent less taxes than usual.

Corporate tax breaks in Moscow

Tax category

Current rates

Rates/Breaks

 

 

 

Industrial complex

Technology park

Profit tax into the Moscow city budget

18 percent

18 percent

13.5 percent *

Property tax

For industrial facilities-2.2 percent of book value

 

For retail outlets and office developments-1.3 percent of 2016 cadastre value

50 percent of calculated real-estate tax payable

0 percent of calculated real-estate tax

Land tax

1.5 percent of  cadastre value

20 percent of calculated tax payable

0.7 percent of  calculated tax payable

Land-lease payments

0.01-1.5 percent of  cadastre value

0.3 percent of  cadastre value

0.01 percent of  cadastre value

 

* For management companies and anchor residents of technology parks.