- March 27, 2015
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The Russian government has submitted to the State Duma a draft law on amnesty: Russians illegally owned assets abroad will be free to legalize them and to avoid administrative and criminal liability. Experts are positive about the bill, but indicate that the ultimate efficacy will depend on a number of important details.
On the need for such an amnesty Vladimir Putin said in his message to the Federal Assembly.
” If people legalize their money and property in Russia, it will get a solid legal guarantees that it will not carry on various bodies, including law enforcement, shake it here and there, “- said the president on December 4.
As a result, the bill prepared by the government, indeed seemingly liberal guarantees and owners of foreign assets immunity from persecution by the tax and law enforcement bodies.
According to the project, in the period from June 1 to December 31 of this year the Russians can submit a declaration on property, accounts, shares in companies outside the country, while not making the budget no special payments (originally stated about 1% of total assets).
At the same time, they are exempt from prosecution by the eleven articles of the Administrative, the ten articles of the Criminal and six articles of the Tax Code. Legalization of assets does not imply the mandatory repatriation.
Amnesty and deofshorizatsiya in-one
Although the legislative initiative in this case came from the president and the government, in -This is interested in the amnesty is a business, the more so because, by definition, free legalization will not bring any income budget.
The reason for this interest – not so much a desire to emerge from the shadows as possible to avoid major costs in connection with the entry into force law on controlled foreign organizations.
He started operation on 1 January and, according to the letter of the law, business, owning shares in foreign companies, more than 25% are required to pay taxes to the Russian treasury. Since many Russian legal entities conducting business through foreign offshore company, in any case they have to go out of the shadows or hide very well now, so as not to break the law on controlled companies.
At the same time, “leaving the dusk” entrepreneurs would not be immune to logical questions about where they were before, and what is the origin of their foreign business. The amnesty law theoretically gives them the assurance that no unpleasant questions.
Knowing about these hopes entrepreneurs, the government has tried to synchronize the law on amnesty Kickaha capital. Finance Minister Anton Siluanov promised to postpone the filing of returns under the law on June 15, Kickaha. If capital amnesty will begin on June 1, then the business will have two weeks to ensure that declare shares in foreign companies.
“Introduce Yourself to 10 years in prison”
But experts see the threat to the effectiveness of the new law.
The first and most important question is what articles Admnistrativnogo and Criminal Codes, ultimately, will be an amnesty, said the director of the Moscow office of Tax Consulting UK Edward Savulyak.
“If among the articles covered by the amnesty, will not be 174 article of the Criminal Code on money laundering, the large sense of the law will not. If a person says that he went to the violation of the tax, currency or customs legislation, of course, peculiar to this trailer is laundering or legalization. It turns out that people in such a case to himself inform the tax authorities of all, to sit down for a period of seven to ten years, “- says Savulyak.
Meanwhile, even if the Russian authorities wish to include article 174 of the Criminal Code in the final version of the law, then it is highly probable that oppose intergovernmental organization FATF (Financial Action Task Force on Money Laundering), of which the Russian.
Consultation with the FATF will begin on Monday 30 March, said First Deputy Prime Minister Igor Shuvalov. However, the Russian expert community is great skepticism about the fact that with the organization will be able to agree.
Fear raiding
There are other concerns that makes the business community government bill.
“The law, of course, timely, but the business is unlikely to get a clear assurance that the capital will not be amnestied withdrawn and that the income will not be taxed more” – believes director of international corporate finance IPT Group Dmitry Kvitko.
On paper it looks good, he says, but in practice, many entrepreneurs have (and often justified) doubts that the government promises will be fulfilled exactly.
He points to another fear entrepreneurs: raiding.
“It is believed that one of the main reasons for offshore business was tax evasion, but this is not true. According to our estimates, the business went well, to defend against hostile takeovers. Practice shows that foreign providers of offshore services store information on beneficiaries is much better than many Russian structures “- says Kvitko.
As an example of that foreign jurisdiction are able to securely store information, he cites the case of the airport” Domodedovo “: Russia’s Investigative Committee for more than a year trying to figure out who it belongs to the same formal (the real owner of all the know).
The State Duma will consider the bill in three readings in the spring session, the effective date of the law in force is scheduled for June 1.
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