By cut and try

Ekaterina Boldinova, Senior Associate of the Tax and Customs Law Practice of the Law Firm "YUST" commented for the Russian Business Newspaper on the extension of the prohibition to create new consolidated groups of taxpayers until 2019.

Anton Siluanov, the Minister of Finances, has already spoken for the prohibition to create new taxpayers’ groups until 2018. Ekaterina Boldinova reminds that 16 such consolidated groups are already registered in Russia: “These are created by large companies in order to avoid the control over internal holding prices, and also to unite the profits and the losses and to pay taxes from the joint financial result”.

The moratorium on creation of new consolidated groups has already been active during 2015. It was imposed by the Federal Law No. 366-FZ dated 24.11.2014. The expert explains: "According to that Law, all agreements on creation of CGTs enter into force only on January 1^st of 2016; however, the groups that have already been created may continue to operate as CGTs during the moratorium. Such groups only include those that managed to start operating before 2014".