Preventing tax evasion – drafting legislation

An open All-Russian Contest for Draft Laws Against Tax Evasion has been launched. The contest has been initiated by Pepeliaev Group and is supported by the Russian Ministry of Finance. It aims to unite tax law experts in their efforts to prepare and sel ect draft laws that make provision for tools which prevent tax legislation from being abused for minimising taxes. These draft laws should also provide guarantees to taxpayers that the tax implications of their activities will not be reviewed without a good reason.

In his Budget Message with suggestions on forming the federal budget in 2010-2012, the President of the Russian Federation pointed out that the budget policy should primarily aim to “leverage practical experience accumulated by arbitration courts in order to enshrine in the legislation tools to prevent taxpayers from, abusing Russian tax laws for minimising taxes”.

The contest is organised by the Russian Chamber of Commerce and Industry and Nalogoved magazine. The Chamber of Tax Advisors is providing professional support for the Contest.

Draft laws will be accepted until 12 October 2011. The best draft laws will be discussed and the results will be announced at an open meeting in November 2011. The selected draft laws will be sent to the Russian Ministry of Finance, the State Duma and other state authorities as those recommended by leading tax experts.

The idea of holding the All-Russian Contest for Draft Laws Against Tax Evasion has been supported by the Russian Ministry of Finance. Sergey Shatalov, the Secretary of State and Deputy Minister of Finance, pointed out that, “In the present-day situation we need the legislation to provide for tools to prevent tax laws fr om being abused for minimising taxes. Special attention should be paid to the criteria for distinguishing between legal ways to reduce taxes and illegal tax evasion, as well as procedures for checking the ‘business purpose.’” The Deputy Minister believes that “using legislation to create such a mechanism will help us to ensure stable property relations and forecast how both taxpayers and the authorities will act.”

Sergey Pepeliaev, member of the jury and Managing Partner of Pepeliaev Group, noted that, “Fighting tax abuse is a complex and socially sensitive issue that requires united effort, excellent knowledge of Russian case law and foreign experience, as well as public support. The Contest will help us draw together the most interesting and valuable ideas, arrange for the professional community to discuss them extensively and together work out possible solutions to the problem.”

The Jury of the Contest comprises:

V.V. Batsiev – Member of the Presidium of the Russian Supreme Arbitration Court;
G.A. Gadzhiev – Judge of the Russian Constitutional Court, Doctor of Juridical Science (S.J.D.);
T.A. Ilyushnikova – Deputy Director of Department for Investment Policy and Public-Private Partnerships, Russian Ministry for Economic Development;
O.V. Ovchar – Head of Legal Department of the Russian Federal Tax Service;
M.Yu. Orlov – Deputy Head of Expert Council for Tax Legislation under the State Duma Committee for Budget and Taxes, PhD in Law;
S.G. Pepeliaev – Managing Partner of Pepeliaev Group, PhD in Law
S.V. Razgulin – Deputy Head of Tax and Customs Tariffs Policy Department of the Russian Ministry of Finance;
D.Е. Fadeev – Deputy Head of Legal Department, Russian Chamber of Commerce and Industry, PhD in Law;
D.G. Chernik – President of Russian Chamber of Tax Advisors, Doctor of Economics.

The Contest’s official webpage can be found at: www.nalogoved.ru

Should you need any additional information please contact V.M. Zaripov, Head of the Contest Organising Committee, Deputy Chief Editor of Nalogoved magazine, Head of Analytical Department in Pepeliaev Group, tel.: (495) 967-00-40.