Rewrite it seven times

The Duma and the government cannot agree on new tax administration rules

The bill on improving tax administration, previously announced as a priority for the government, still cannot reach the finish line in the State Duma. Deputies are even threatening to make “changes to changes,” namely amendments to the 450-page package of amendments to part one of the Tax Code. Before the May holidays, the tax subcommittee must decide in what form the amendments on administration will be submitted to the budget committee for consideration. Deputies and the government have no more than a week left for approval. According to members of the expert council on tax legislation of the Duma budget committee, deputies should show maximum firmness in some positions. So as not to edit the code again when the new rules come into effect.

In particular, it is possible that deputies will insist on clarifying the period during which the taxpayer will have the right to appeal the decision of the tax authority through the appeal procedure. Now the amendments include a ten-day period, which is supposed to guarantee the suspension of execution of the fiscal decision while a higher tax authority or court makes its decision. The Expert Council proposes to start counting the ten-day period from the moment the payer familiarizes himself with the decision of the tax authority, since postal services often “eat up” almost all of this time. However, the government will most likely be categorically against such a formulation of the issue. After all, the main argument of tax officials in such a situation is the danger that the taxpayer who has come under suspicion will simply go on the run.

The wording introducing criminal liability of tax inspectors for knowingly illegal decisions and abuse of official position is still in question. While deputies believe that it is not worth skimping on introducing personal liability for inspectors, the government is of the opinion that it is easy to overdo it in this matter. After all, the legislation formally already has provisions that make it possible to hold any official (that is, the taxman included) accountable for abuses. True, the tax authorities have not yet been involved - even those who at one time checked YUKOS and did not reveal any tax evasion.

The parties have not fully decided on the timing of on-site inspections. More precisely, with reasons for their extension. Both the government and deputies agree that the list of grounds should be as comprehensive as possible. However, it is not yet known whether it will be limited only to the need to conduct an examination or counter-inspection of counterparties, or whether it will also include other grounds.

It is possible that new changes will be made to the procedure for conducting desk audits. Deputies radically revised the articles of the Tax Code on desk audits: tax authorities, according to the amendments, cannot require the provision of additional documents as part of an audit, but only have the right to ask for additional explanations. An exception to this rule is proposed to be operations to verify the validity of applying the zero VAT rate. Thus, the Tax Code is actually being rewritten to suit immediate fiscal objectives.

Irina SKLYAROVA