Russian parliament approves tax hike bill

Russia's Federation Council, or the upper house of the parliament, passed a bill on increasing the value-added tax (VAT) rate from 18 percent to 20 percent at a plenary session on Saturday.

The new VAT rate will become effective on Jan. 1, 2019 with the exemption of certain products with preferential tax rates, such as foodstuffs, children items and medical goods, according to local media.

The tax hike will increase government revenues by 620 billion rubles (about 9.9 billion U.S. dollars) a year, according to a State Duma statement.

The bill was passed on Tuesday by Russia's State Duma, or the lower house of the parliament, and has yet to be signed into law by Russian President Vladimir Putin.