TAX ENFORCEMENT / RESTRICTIONS ON CIRCULATION OF CASH MONEY
Following Presidential Decree No. 1212 of 18 August 1996 (See Tax Alert 10/96 of 27 August 1996), the Central Bank has now issued an instruction on implementing provisions of the Decree which restrict the circulation of cash money. Withdrawals in cash by legal entities may only be made from current accounts of those legal entities. This may be interpreted so that cash transfers from an overseas Head Office to a Russian representative office will not be permitted, and that such legal entities will have to open a bank account in Russia. It is also not permitted to deposit cash in the bank account of another legal entity. This must be done by a bank transfer.
Order of the Central Bank of 12 November 1996 No. 360
The Service for Currency and Export Control has become a "Federal Service" with ministerial status, and is now on the same level as the tax police. This may imply that compliance with currency regulation will be monitored much more closely in the future.
Presidential Decree of 29 November 1996 No. 1611
INSURANCE EXEMPTION REINSTATED
According to a so far unpublished Government Regulation, insurance premiums can be deducted for profits tax purposes up to 1% of the turnover as from 15 November 1996. Earlier this year the deduction for insurance premiums was "temporarily abolished". The scope of the current exemption is wider than the earlier one: premiums for voluntary insurance of transport vehicles, property, civil liability of organisations, sources of increased danger, liability of transporters, professional liability, life and medical insurance are covered. In order to enter into force, the Regulation must be officially published and registered with the Ministry of Justice. We will advise readers when this happens.
Government Regulation of 22 November 1996 No. 1387
For further information contact Bauke van der Meer on tel: +7 503 232 5511 fax: +7 503 232 5522 or e-mail directly: Bauke_van_der_Meer@ru.coopers.com or enter a text search 'Coopers & Lybrand' and 'Business Monitor'
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