Disbanded Russian Energy Giant Yukos Overpaid Taxes

April 07, 2008 06:00 AM
by findingDulcinea Staff
A report says authorities charged Yukos twice the taxes it owed, causing the company’s bankuptcy and helping secure its assets for the Putin government.

30 Second Summary

After examining a court ruling and studying the tax fines that led to Yukos’ collapse in 2004, Russia's Vedomosti newspaper reported that the company overpaid its taxes by more than 90 billion rubles, or $3.8 billion.

Yukos was once the largest independent oil producer in Russia.

But in 2004, Russian tax officers presented the company with four years of tax claims all at once, accusing the company of tax evasion. The tax bill included double fines for the period from 2001 through 2003, based on the company’s "repeated wrongdoing."

But the newspaper’s investigation has uncovered a Russian court ruling that such tax fines could only be doubled if a taxpayer was previously "made accountable for similar wrongdoing."

Yukos hadn't been charged with repeat offenses between financial inspections, so the doubled fines were unwarranted, reports the Russian news site Kommersant says.

Yukos receiver Eduard Rebgun says that, during the company’s bankruptcy, he was able to clear accounts with most creditors, but lacked 76 billion rubles (approximately $3 billion) to fill all claims. The 76 billion rubles was written off as bad debt.

Yukos was broken up and sold to meet taxes and creditors’ claims, with much of the former company’s assets ending up in state coffers.

Several former Yukos executives are still serving prison terms for fraud and tax evasion after what some call politically motivated trials.

The reported tax overpayment cannot be returned because Yukos’ bankruptcy proceedings are complete. 

Headline Link: Yukos reportedly overcharged by billions in taxes

Opinion & Analysis: Russia sees return of political trials

Related Topic: Trial of former oil company official adjourned

Reference: The Yukos story and Russia’s legal system


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