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More transparency for importers and exporters in the performance of their VAT obligations

02/2015

In late December, President Vladimir Putin signed Federal Law No. 452-FZ "On the Amendment of Article 165 of the Second Part of the Russian Tax Code". This new law introduced some important changes regarding the exchange of information between customs and tax authorities. The core group of these changes came into force on 29 January 2015, and it is believed that the habits of importers and exporters will be affected as a result of their enactment.

Previously, Russian customs and tax authorities would exchange their information primarily in the formal context of disputes with the taxpayers. Now, these bodies will more systematically communicate by electronic means along the lines laid down by the abovementioned law. In turn, from 1 October 2015, Russian taxpayers who are involved in the import and/or export business may submit electronically to the tax authorities the various shipping documents required for VAT deduction purposes. It will be possible to submit these documents in the form of descriptive summaries, rather than as actual copies of the documents. Taxpayers will also be able to use the information already presented to customs officers in order to electronically confirm to the tax authorities that import VAT was actually paid on the goods.

For taxpayers, the new rules establish a system that will make their interactions with the tax authorities more flexible, more modern and more comfortable. The new rules should also reduce the costs taxpayers incur when they are required to provide supporting evidence of (i) the legality of the application of a zero export VAT rate, as well as (ii) the actual payment of the import tax on goods. The use of the new electronic communications procedures will greatly simplify the process for the submission of supporting documents, and will allow taxpayers to both save time and human resources. For the authorities, the new procedures will enhance the effectiveness of tax control. Modernisation of paperwork is undoubtedly good news for importers and exporters of goods. It is one of the items on the Russian Government’s official tax policy agenda for 2015-2017. That being said, it is equally important to also highlight the downsides which accompany the new rules. The tax authorities will soon have new resources to enable them to proceed with the cross-checking of data against the information that taxpayers have provided to customs. Importing companies should therefore take special care when filling in shipping and transport documents to avoid being sanctioned by the tax authorities. In this context, it seems that the so-called "grey" import schemes have their days numbered from now on. 

Published in Le Courrier de Russie, No. 273

Authors

Safaryan Hayk
Hayk Safaryan
Partner
Moscow