The Reality and the Expectations From Tax Amnesty In Russia

The tax amnesty in Russia started in March 1 of 2007Russians, as the deliberate people, remembering the
and ends in January 1 of 2008. Taxpayers pay a taxsad history, are not so trusting to Tax Agencies and
rate of 13% from all income that was not legalized butafraid to report the information that may be used
received before January 1 of 2006.against them.
I know from my experience, and it is not a secret, ofThe Federal Treasure published the statistic that in
the double-dealing accounting in Russian companies;March - July of 2007 civilians transferred to budget's
one is the official and another one is under table, it callssystem of Russia 377.4 million rubles (approximately
in Russia (black accounting). If you doing business in$13.2 million). As Treasury published, it was only $113
Russia you better count on double-dealing accounting.millions of income, which was legalized.
Almost every company has a double-dealingIt was not a big surprise that the most of the collected
accounting just because the income tax rate andmoney came from Moscow- $5.9 million, Saint
payroll taxes were very big in old Russian tax code. IfPetersburg second place - $700 thousands and an
company paid all of the taxes it could go bankruptcyanother "record" was made in Kalmic; they collected
quite fast. Knowing of this situation by Russian$3!
government, it came up with the decision of thisThis information may be a good hint for the best place
amnesty.of doing business in Russia and for places of
But here are some exceptions; people who commitdeveloping businesses.
any other crimes besides concealments of incomes,The pick of the amnesty fall in the Summer time of
like concealments of income received by breaking thethis year, may be as a result of overheated weather in
criminal law, financial law, customs law or any otherMoscow, so only in July was collected almost 1/3 of all
law do not have this amnesty.collected money.
According to the current law, non-payment of taxesThe expectations of the amnesty are far from reality;
from the received incomes (concealments of incomes)it was expected legalization of $5-7 billions but as it is
considering to offence of braking administrative andgoing now in reality may be only $1 billion.
the criminal liability. Other words people who did notOther word, Tax Amnesty in Russia is way below of
pay taxes from annual income more than 100the expectations of the Government and considered
thousands rubles (approximately $3,900) considered toto be not very successful.
be the violators.People did not believe in the good intents of the
Unfortunately, Russian people are not in a big rush toauthority, but still for anyone who believes in the good
be remorse of there sins in taxes. Tax amnestygovernment they have the time for repentance of
started in March 2007 and it is continuing without a bigtheir concealments of incomes; the amnesty is
success as it was expected; even if taxpayer has thecontinuing till the end of this year, December 31 of
rights not to disclose the source of their income.2007.