Federal tax \ Profits tax and VAT \ New amendments
On 5 December 1995 the State Duma approved amendments to the current profits tax and VAT legislation. The new laws must be approved by the Federation Council and be signed by the President before they come into force. Major amendments to be introduced by these laws are a definition of "export of services" for VAT purposes under which, in particular, a service will be treated as exported if the customer's business is located outside Russia, and restoration of the VAT exemption for in-kind contributions to the charter capital. In addition, if a company owns more than 50% of the charter capital of a subsidiary, then funds transferred between the two companies shall not be subject to profits tax. Further comments on the expected laws will be made in our next Tax Alert.
Currency regulation \ Control over payments to overseas suppliers
A recent Presidential Decree has established that, from 25 December 1995, Russian residents who have transferred hard currency to foreign suppliers under trading contracts, must ensure that the relevant imports are received or the cash transferred is returned within 180 days. Violation of this rule may result in the Russian resident suffering a financial penalty equal to the amount initially transferred to the foreign supplier.
(Decree of the President of the RF N1163 of 21 November 1995)
Legal developments are reported in Tax News Reporter on official publication. This may be long after the law is issued.
This publication is intended for general guidance only and should not form the basis of specific decisions.
For further information please contact the firm on +007 503 232 5511 or enter text search 'Coopers and Lybrand' and 'Business Monitor'.
To print this article, all you need is to be registered on Mondaq.com.
Click to Login as an existing user or Register so you can print this article.
The New Turkish Commercial Code ("New Code") has been enacted and will enter into force in July 2012. One of the major changes brought by the New Code regards mandatory independent audits of corporations.
The law about payment of dividends has remained substantially unchanged for thirty years.
Some comments from our readers… “The articles are extremely timely and highly applicable” “I often find critical information not available elsewhere” “As in-house counsel, Mondaq’s service is of great value”
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).