To the Day of the FTS Worker: Checks without cavils

The Federal Tax Service of the Russian Federation has existed for 22 years, and during this time it has learned things that nobody expected: it started speaking the language, which is understandable for most taxpayers, and has not yet become a friend, but is certainly no longer perceived as an enemy for them. On the eve of the Day of the Tax Worker, which is celebrated on November 21, Mikhail Mishustin, Head of the FTS of Russia, told Vladimir Putin, President of the Russian Federation, why the taxpayers started arguing less with the tax authorities and paying more taxes.
During the last nine months, 11% less complaints against the taxmen were filed than for the same period of the preceding year, and the number of court cases decreased 20%, told M.Mishustin to the Head of the State.
The fact that the business protests less against the tax authorities’ decisions is a pattern rather than something new: similar results were declared according to the results of the year 2011-2012.

IF YOU DON’T PRASIE YOURSELF, THE OTHERS WILL

Development of modern client services, openness for the dialogue are among the chief accomplishments of the Federal Tax Service mentioned by the experts.
Alexey Nesterenko, Senior Manager of the Tax Section of Ernst & Young, told the PRIME Agency: “In the past, it was quite difficult to obtain any information from the tax authorities directly, including the data on excessive payments or debts (…). The process was routine, complicated and time-consuming”.
He said: “Now the Tax Service has developed the electronic declaring system, simplifying the process greatly”. The expert points out that the FTS of Russia develops new services on its own. He stated: “From the administrative point of view, this is a significant achievement”.
The FTS of Russia regulates taxes, which are paid by over 4,5 million companies and 136,5 million individuals. 32 online-services are available to them at the official website of the FTS, which allow registering a business, to check on a counterpart, to find out the situation of one’s personal account and to pay tax debts.
Advocate Maxim Rovinskiy of the Law Firm "YUST" points out that when tax authorities make the life of the taxpayers easier, they also simplify their own work. The Advocate mentioned as the most important novelties of the tax regulation the possibility for the citizens to not include in the tax declaration the income, which is exempt from taxes, and the income, the tax on which has already been exacted.
M.Rovinskiy said: “Such measure has made the life of the taxpayers much easier, has decreased the workload of the tax authorities, while avoiding the harm to the income of the budget”.

RARELY BUT NEATLY

When the experts go through the positive changes, they are unanimous: each year, the tax checks are fewer but more efficient. During the first six months of the current year, the tax authorities have held 30,1 thousand of field checks, which is 8,5% less than in the same period of 2011. There were 18,2 million of office tax checks, which is 4,7% less than last year.
The efficiency of the checks has increased: 230,6 billion roubles of taxes were additionally credited to the budget system during the first semester of 2012, which is 48,7 billion and 26,8% more than in the same period of 2011.

IF I KNEW WHERE I WOULD FALL…

Currently, the taxpayers are able to foretell accurately enough if a tax inspector is likely to visit them: the FTS has published at its website the criteria for the tax authorities’ decision to hold a field check.
However, it is difficult to know in advance, what position the inspector will take on certain issues.
A.Nesterenko believes that it would be useful to implement a mechanism of previous agreement of operations with the tax bodies.
According to him, such agreements exist in many countries.
Similar mechanism for largest taxpayers has started operating in Russia this year. It is about the price-forming agreements, which permit the preliminary accordance with the tax authorities of the price of transactions between affiliated structures to take them out of the sphere of control of transfer prices. The Tax Service executed the first such agreement with the Rosneft OC OJSC on November 20.

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POSITION IN THE RATING

Pavel Gagarin, Chairman of the Board of “Gradient Alpha” audit and consulting group, believes that the quality of tax regulation in Russia has objectively improved in 2012.
He reminded that the rise from the position 120 to the position 112 in the Doing Business-2012 rating was mainly a result of the simplification of the tax payment procedure. P.Gagarin added that Russia has risen from the 105^th place to the 64^th in the rating of the World Bank precisely on this indicator – simplicity of the tax payment procedure.
P.Gagarin explains: “This has happened because the VAT payment was simplified, web services for tax payment were implemented, two out of nine yearly payments were revoked, the time required for tax payment decreased from 290 hours per year to 177 hours”.

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