| Nizhny Novgorod tax authorities and the regional administration have different views on Belgian investments The reconstruction project of the Bor Glass Factory became the subject of a lawsuit between the Nizhny Novgorod department of the Ministry of Taxes and Duties and the Belgian concern Glaverbel. UMNS believes that the investor did not comply with the 1997 agreement concluded with the administrations of the region and the city of Bor, and demands the return of 950 million rubles to the local budget. It was for this amount that the glass factory was granted tax breaks. In turn, representatives of the plant and the regional administration say that Glaverbel has invested the necessary amount in the reconstruction of production, and tax authorities interpret the regional law “On State Support of Investment Activities” in a unique way. The regional arbitration court scheduled to consider the case on March 18.
In 1997, Glaverbel became the owner of a 36.4% stake in the Bor Glass Factory and signed an investment agreement worth $65 million. Tax officials claim that instead, the Belgian concern invested only $15 million in reconstruction (with this money it acquired its stake in ) and, therefore, the investment agreement was not fulfilled. In their opinion, now the plant must return not only 431 million rubles. financial benefits provided by the administration of the Nizhny Novgorod region to the plant, but also all fines and penalties accrued for this amount.
The investor considered that since he is the owner of shares in the plant, the profit that the plant allocates to modernize production is his investment. But since the Glaverbel group owns only a third of the plant, UMNS representatives say, “the terms of the investment agreement cannot be considered fulfilled.” The regional Minister of Economy and Entrepreneurship Development, Galina Kuzmina, told the Vremya Novostey newspaper that the current situation was caused by a “misunderstanding” on the part of the tax inspectorate. The results of an audit by the Commission on Investment Activities under the Ministry of Economy of the Government of the Nizhny Novgorod Region indicate that the agreed amount was invested in the development of production.
According to Nina Mamykina, deputy head of the Department of Tax Administration for the Nizhny Novgorod Region, the Bor Glass Factory invested its own funds in the reconstruction of production - from the profit of the plant and its depreciation charges, but Glaverbel spent only $15 million on the purchase of shares in the plant.
Representatives of local authorities believe that the cause of the conflict is the imperfection of the regional law “On State Support of Investment Activities,” which gives the right to receive benefits when implementing a priority project for the region. And the essence of the dispute between the tax authorities and the Belgian investor lies in the different interpretation of the concept of “investment”. Neither the regional law nor the investment agreement itself has a clear definition of what exactly should be considered an investment in this case, and therefore the calculation of investments made in a project and subject to preferential taxation can be made in different ways. Grigory KOTOV, Nizhny Novgorod |
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