Translated material
They gave it wrong
Kaliningrad investors were deprived of tax benefits
Normal infrastructure and support from government authorities is what investors need. This is what they decided in the Kaliningrad region and canceled tax breaks for a number of enterprises. The regional Duma made a corresponding decision on Thursday.The idea of waiving benefits was previously voiced by the regional governor Georgy Boos. At one of the recent meetings of the regional government, amendments to the local law “On state support for organizations making investments in the form of capital investments in the Kaliningrad region” were discussed. The regional government decided to create a group of officials who would legally lobby for the interests of investors. Not all, however, but only priority ones (for this purpose, the amount of their capital investments in the region cannot be less than 90 million rubles).
At the same time, tax breaks for a number of local enterprises were cancelled. When this idea was still being discussed, Governor Boos spoke very harshly about the Avtotor company, a local auto assembly giant. In the Kaliningrad region in recent years, it has become the calling card of a special economic zone, a clear confirmation of its effectiveness. The company assembles Hummer and Chevrolet SUVs, KIA and BMW cars. Local officials are very fond of driving the last two models. And giant Hummers are rare on Kaliningrad highways. And not because it’s expensive, it’s just that the roads in the region are narrow, such SUVs have difficulty passing oncoming cars. “Look at this Avtotor - in 2004 the company paid 624 thousand rubles to the regional budget. And for 2005 it received tax benefits worth 135 million! Do we need investors like this who don't pay taxes? No!" - Mr. Boos spoke harshly about the enterprise. In his opinion, this is how a business gets used to not paying taxes.
The Chairman of the Board of Directors of Avtotor-Holding, Vladimir Shcherbakov, did not comment on such a harsh statement by the Kaliningrad governor. “He spoke differently to me. I haven't heard anything like that from him. But, as they say in Rus', a contract is more valuable than money. We are fulfilling our agreement. I don't think we don't pay taxes. Yes, we pay little to the regional and local budgets, but a lot to the federal budget. About 3 billion rubles,” said Mr. Shcherbakov. In his opinion, there is nothing wrong with “preferential treatment” for an entire industry. “After all, this is exactly how the law on a special economic zone works. And the Kaliningrad law is not needed at all in this case,” he added.
Many tried to deprive the Avtotor company of tax benefits. Two years ago, for example, Mr. Shcherbakov’s quarrel with ex-governor Vladimir Yegorov became very loud. Offended by the fact that the auto oligarch called the region a place where everyone stole, the governor filed a lawsuit (claim for 10 million euros), petitioned to exclude Mr. Shcherbakov from the interdepartmental working group under the administration of the President of the Russian Federation for the development of the Kaliningrad region, as well as to deprive him of status of honorary consul of Greece. But then the scandal was hushed up. And no claims were made against Vladimir Shcherbakov (note: the former Deputy Prime Minister of the USSR). Until now.