Despite the economic turbulence, 2015 resulted in a tax revenue increase according to the Russian Federal Tax Service. The FTS explains that this is due to an increase in tax inspection efficiency, while business is seeing an increase in documentation requirements from the tax authorities, as well as tax inspection scrutiny. Nowadays a tax inspection is not limited merely to an analysis of source documents: tax authorities request many other documents (ranging from meeting notes and emails to employees' personal notebooks), conduct interviews, and actively exchange information with foreign tax offices following a tightening of deoffshorisation legislation. The inspections' ultimate goal is to explore a company's business in detail in order to identify the feasibility of the operations and deals that resulted in the paid tax amount reduction.
Such an approach to tax inspections by the FTS has indeed led to an increase in their efficiency. Furthermore, the increased scrutiny has identified operations that previously did not give rise to claims. Some are certain that the tax authorities' increased effectiveness can be explained by the current economic situation in Russia and the courts' consequent tendency to support taxpayers less, which makes it easier for tax bodies to meet their budget obligations. The authors of the article believe that one shouldn't expect a change in the new FTS approach, which is set to continue – even if the oil price recovers.
© 2020 KPMG. KPMG refers JSC “KPMG”, “KPMG Tax and Advisory” LLC, companies incorporated under the Laws of the Russian Federation, and KPMG Limited, a company incorporated under The Companies (Guernsey) Law, as amended in 2008.