Authors: Magomed M. Suleymanov, Cand. Sc. (Econ.), Associate Professor of Taxes, Money Supply and Credit Dept., Dagestan State University

Raisat M. Magomedova, Cand. Sc. (Econ.), Associate Professor of Taxes, Money Supply and Credit Dept., Dagestan State University

Asiyat M. Mirzakhanova, Jr. Lecturer of Taxes, Money Supply and Credit Dept., Dagestan State University

Abstract. The paper is devoted to exploring the role of corporate income tax in formation of the revenue base of regional budgets. The analysis of scientific views on the nature of profit is carried out and helps us to generalise about its main characteristics. The distinctive features of corporate profit in the market economy are defined. The dual nature of profit as a source of reproduction and the aim of entrepreneurial activity is revealed. The authors argue that in today’s conditions profit serves as a link in the mechanism of coordination of interests of entrepreneurs and the state. The fiscal importance of income tax in replenishing the revenue part of budget of different levels is displayed. The authors identify the disadvantages of the procedure of income taxation and calculation of a particular income tax which consist in the complexity of calculating the taxable base and the presence of a number of inaccuracies in the legislation provoking a negative financial effect. They propose measures for perfecting taxation of corporate profit.