Importance The most significant tax incentives for investment activity are tax credits and tax benefits on corporate profit tax. Their proper use may ensure the safety of financial savings and financing the business expansion and new investment driven by tax optimization. Objectives The study aims to assess tax credits on corporate profit tax in the context of investment activity stimulation. Methods The study applies general scientific methods as scientific abstraction, induction and deduction, synthesis, comparative and contrastive analysis, and regression analysis. Results I reviewed the main tax instruments applied in Russia and overseas to boost investment activity, which are based on the use of corporate profit tax, analyzed the current Russian practice in providing investment tax incentives on corporate profit tax. The paper shows the specifics of granting tax preferences on corporate profit tax in various subjects of the Russian Federation, and presents a calculated regression model of dependence of the volume of investments in fixed capital on the amount of tax credits on corporate profit tax. Conclusions Currently, investment benefits on corporate profit tax are a powerful tool to implement neo-industrial modernization and innovative development of the Russian economy. Therefore, proposals have been developed to improve the tax mechanism of stimulating the investment activity in Russia. These proposals rest on the use of corporate profit tax and envisage a depreciation reform and measures to enhance the implementation of investment tax credit.
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