The History of Taxation in Russia

In the Soviet Union, the predecessor state to Russia, there existed in practice no real taxation system. This was quite natural against the background that in the USSR with its planned economy it was a stated aim to create the first ever state without taxes. Practically speaking, all production property and assets were state-owned, and asset and profit allocation was done by the central planning organization.

In the planned economy the companies were not actually taxed, rather they transferred certain residual amounts of financing back to the center.

With the economic reforms of 1900s, there emerged a need to create a taxation system suitable for a market economy. The process of creating an appropriate taxation system has neither been quick nor painless. The taxation system, or rather the lack of a transparent, predictable and stable taxation system, has widely been considered as one of the main reasons for the economic woes that Russia experienced during the 1990s.

A tax system started to emerge from the beginning of the 1990s. During these early years of reforms the tax laws did not take shape within a unified system, but rather through the ad hoc adoption of laws and rules, regulating taxation, which kept changing frequently. There was a lack of clear rules for norm hierarchy (knowing which laws and rules would take preference over each other) and a lack of rules defining the authority of various governmental, federal and local bodies. This lead to serious flaws in the legal protection of the taxpayer, who was often left to the arbitrary whim of various authorities. The gradual adoption of the Russian Tax Code has brought order into the taxation system. Considering the current results of the tax reform at hand one may well conclude that in less than ten years a fairly

Unit 24. The tax authorities of the rusian federation

THE TAX AUTHORITIES OF THE RUSIAN FEDERATION

The first part of the Tax Code of the Russian Federation states that Tax Authorities ( Tax Bodies) in the Russian Federation are the Federal Tax Service of the Russian Federation and its territorial divisions in the Russian Federation ( article 30).

According to article 31 the Tax Bodies shall have the right:

1) to demand from a taxpayer or a tax agent documents in the forms established by state bodies and local self-government bodies to serve as grounds for the calculation and payment (deductions and transfers) of taxes;

2) to carry on tax inspections in the order prescribed by this Code;

3) to make a seizure of documents, during tax inspections of a taxpayer or a tax agent, testifying to the commission of tax offences in cases when there are sufficient grounds to believe that these documents will be destroyed, concealed, changed or replaced;

4) to summon to tax bodies taxpayers, payers of dues or tax agents to give pertinent explanations by means of written notices in connection with the payment (deduction or transfer) of taxes by them or in connection with a tax inspection, and also in other cases associated with the execution by them of the legislation on taxes and dues;

5) to suspend transactions in the accounts of taxpayers, payers of dues and tax agents in banks and to distrain the property of taxpayers, payers of dues and tax agents in the order prescribed by this Code;

6) to examine (inspect) workrooms, depots, trading and other premises and areas used by taxpayers to derive income or connected with the maintenance of the objects of taxation, regardless of their place of location, to draw up an inventory of the property belonging to taxpayers. The procedure for drawing up an inventory of the taxpayer's property during a tax inspection shall be endorsed by the Ministry of Finance of the Russian Federation and the Federal Tax Service of the Russian Federation;

7) to determine the sums of taxes to be paid by taxpayers to the budget or to the extra-budgetary funds and calculated on the basis of available information about a taxpayer, and also of the data on other similar taxpayers in case of the refusal of the taxpayer to admit tax officials to examination (inspection) of workrooms, depots, trading and other premises and areas, used by the taxpayer to derive income or connected with the maintenance for the purpose of taxation taxation, in case of the refusal to submit to a tax body documents necessary for the calculation of taxes during more than two months, in case of the absence of the record-keeping of incomes and expenses, of the objects of taxation, and in case of keeping a record with the contravention of the established order that has led to the impossibility of computing taxes;

8) to demand that taxpayers, tax agents and their representatives should remove the revealed breaches of the legislation on taxes and dues and to control the fulfillment of said requirements;

9) to recover tax and due arrears, and also penalties in the order established by this Code;

10) to control the compliance of big expenses of natural persons with their incomes;

11) to demand from banks documents confirming the execution of payment orders of taxpayers, payers of dues and tax agents and the fulfilment of collection letters (orders) of tax bodies on the write-off of the amounts of taxes and penalties from the accounts of tax payers, payers of dues and tax agents;

12) to attract specialists, experts and interpreters for tax control;

13) to summon as witnesses persons who may know any circumstances of relevance to tax control;

14) to apply for the cancellation or suspension the validity of licenses issued for the engagement in certain activities to entities and individuals.

Vocabulary

	Demand (v)	Требовать
	Local self-government bodies	органы местного самоуправления
	Serve(v)	Служить
	Ground (n)	Основание
	Calculation (n)	Исчисление
	Deduction (n)	Удержание
	Transfer (n)	Перечисление
	Carry on (v)	проводить
	Inspection (n)	проверка
	Seizure (n)	Выемка, конфискация
	Testify (v)	свидетельствовать
	Commission (n)	совершение
	Offence ( n)	правонарушение
	Sufficient (n)	достаточный
	Destroy (n)	уничтожать
	Conceal (v)	скрывать
	Replace (v)	заменять
	Summon (n)	вызывать
	Pertinent (adj)	уместный
	Notice (n)	уведомление
	Execution (n)	исполнение
	Legislation (n)	законодательство
	Suspend (v)	приостанавливать
	Due (n)	сбор
	Distrain (v)	налагать арест на
	Derive (v)	извлекать
	Maintenance (n)	содержание
	Workroom (n)	производственное помещение
	Depot (n)	складское помещение
	Trading (adj)	торговый
	Premises (n)	помещение
	Belong (v)	принадлежать
	Endorse (v)	утверждать
	Extra-budgetary (adj)	внебюджетный
	Available (adj)	имеющийся в наличии
	Refusal (n)	отказ
	Admit (v)	допускать
	Official (n)	должностное лицо
	Submit (v)	представлять
	Contravention (n)	нарушение
	Representative (n)	представитель
	Remove (v)	устранять
	Reveal (v)	выявлять
	Breach (n)	нарушение
	Fulfillment (n)	выполнение
	Requirement (n)	требование
	Recover (v)	взыскивать
	Arrears (n)	недоимки
	Compliance (n)	соответствие
	Collection letter (order)	инкассовое поручение (распоряжение)
	Write-off (n)	списывать
	Penalty (n)	пени
	Account (n)	счет (банковский)
	Witness (n)	свидетель
	Circumstance (n)	обстоятельство
	Apply for (v)	заявлять ходатайство
	Cancellation (n)	аннулирование
	Validity (n)	действие ( юридическое)
	Issue (v)	выдавать
	Set up (v)	устанавливать

Exercise 1

Answer the questions.

1. What are the Tax Bodies of the Russian Federation?

2. What should the Tax Bodies demand from a taxpayer or a tax agent?

3. What is the order of carrying on tax inspections?

4. In what case shall a seizure of documents be made?

5. What is the order of suspending transactions in the account?

6. Who determines the sum of taxes to be paid to the budget?

7. What tax authorities endorse the procedure o f drawing up an inventory on taxpayer’s property?

8. In what cases shall the Federal Tax Service of the Russian Federation approve of the forms of applications for registration?

9. In what cases do the Tax Authorities determine the sums of taxes to be paid by taxpayers to the budget or extra-budgetary funds?

10. Who do the Tax Authorities summon to the tax control as witness?

11. When is the cancellation or suspension the validity of licenses applied for?

12. Who do the Tax Bodies attract for tax control?

13. What other rights do you think the Tax Bodies shall have?

14. What are the names of Tax Authorities in the UK, the USA, the Republic of Ireland?

Exercise 2

Match the English word combination in the column with the Russian equivalents in the right-hand column.

1. Transaction on the accounts a. Операция по счетам

2. In the order prescribed в. извлекать доход

3. To draw up an inventory. с. выемка документов

4. Record-keeping of income and expenses d. Налагать арест на

собственность

5. Established order e. устанавливать процедуру

6. Circumstances of relevance f. Приостанавливать операции

7. Derive income g. Скрывать документы

8. Testify to a commission h. Проводить инвентаризацию

9. Conceal document i. Установленный порядок

10. Control the compliance j. имеющее значение oбстоятельство

11. Submit documents l. Предоставлять документы

12. Revealed breaches m. контролировать соответствие

13. Recover arrears n. свидетельствовать о совершении

14. Endorse the procedure о. Выявленные правонарушения

15. Suspend transactions р. взыскивать недоимки

16.Seizure of documents q. учет доходов и расходов

17. to distrain property s. в порядке, предусмотренном

Exercise 3

Match the words on the left with their best synonyms on the right

1. to carry on a. To arrest

2. ground b. a set of laws

3. inspection c. to obtain from

4. pertinent d. denial

5. execution f. To continue

6. refusal g. basis

7. to establish h. check

8. offence i. appropriate

9. trading j. fulfilment

10. premises l. To set up

11. to distrain k. enough

12. legislation m. merchant

13. to derive n. accommodation

14. sufficient o. to order officially

15. to summon p. breach

Exercise 4

Guess the meaning of the word by its definition.

1. a written or printed statement giving information or directions to the public.

2. To stop or cause to be ineffective for a period of time.

3. The act of keeping something in good condition.

4. A storehouse for goods

5. To be the property of somebody

6. To give or offer for consideration

7. Money that is owed from the past and should have been paid.

8. Someone who is present when something happens, for example a crime or an accident.

Exercise 5

Translate into English. While translating consult the text.

1. Взыскивать недоимки по налогам и сборам.

2. Приостановить операции по счетам налогоплательщиков.

3. Требовать от налогоплательщика или налогового агента документы для исчисления и уплаты налогов.

4. Налагать арест на имущество налогоплательщика

5. Документы, подтверждающие правильность исчисления.

6. Проводить налоговые проверки в порядке, установленном настоящим Кодексом.

7. Осматривать производственные, складские и торговые помещения.

8. Порядок проведения инвентаризации имущества.

9. Определять суммы налогов, подлежащие внесению налогоплательщиками в бюджет.

10. Заявлять ходатайства об аннулировании или о приостановлении действия выданных лицензий.

11. Требовать от банков документы, подтверждающие исполнение платежных поручений

12. Контролировать соответствие крупных расходов физических лиц их доходам.

13. Непредставление в течение более двух месяцев налоговому органу необходимых для расчета налоговых документов.

14. Вызывать на основании письменного уведомления.

15. В случаях, когда есть достаточные основания полагать, что эти документы будут уничтожены, сокрыты, изменены или заменены.

16. Контролировать выполнение указанных требований.

Exercise 6. Complete the list below:

Verb noun adjective

operate ……………….. …………………….

………………….. ………………… seizing

…………………. ………………... serviceable

…………………. ……………….. calculable

…………………. Execution …………………..

………………… ……………….. derivative

budget ………………. …………………………… ………………. ………………. ……………. Admissible

………………… ………………. Established

………………… representation …………………..

require ……………… ………………….

Collect ……………… ………………….

………………… suspension ………………….

Exercise 7

Insert the appropriate prepositions if any.

To demand ….. a taxpayer a tax return; to serve as grounds …… payments; to summon ….. tax bodies taxpayers; the property ….. taxpayers; to distrain ….. taxpayers’ property; carry ….. tax inspections; to testify ……the commissions of tax offences; the compliance of big expenses of the individuals …….. their income; regardless ….. their place of location; the procedure ….. drawing up an inventory; the execution of the legislation …..taxes and duties, suspend transactions ……. the accounts of taxpayers.

………………… ……………… transacted