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Friday, July 21, 2017

The export of money abroad is expensive

Customs service (FTS) proposes to establish for entrepreneurs draconian penalties for untimely repayment of money removed from the country under dubious loan contracts or international contracts. The penalty can reach 100% of the amount of the unreturned funds. Plus customs and tax authorities will have the right in court to achieve recognition of the nullity of such transactions. The relevant amendments have already been prepared.

photo: Gennady Cherkasov

Due to the weak ruble, the fall of foreign economic activity, reduction in tourist arrivals over the last two or three years, the volume of net export of capital from Russia is constantly decreasing. In 2014 it totaled $153 billion, in 2015 — $56,9 billion (or 3.7 trillion — a quarter of the Federal budget. — “MK”), for the first quarter of the current year to $12.8 billion, falling to 3.5 times in comparison with the value a year earlier.

However, Russia still remains one of the world leaders in the export of money. It is clear that most of these funds is not criminal. Under a net withdrawal of funds is subject to absolutely everything from payments on external corporate debts to card spend of Russian tourists to overseas resorts.

This year the decree of President Putin of customs and tax authorities gave the status of the monetary authority with a mandate to bring offenders to justice, levy fines, etc.

The FCS claim that last year managed to prevent the illegal transfer of money associated with the violation of currency legislation in the amount of $2.5 billion would be about 4-5% of the total. It’s just something that you “catch”. Realistically, this figure could be much higher.

There are two basic ways of illegal export of capital. The first is the sending of money abroad under a bogus contract for the procurement of something short-lived companies. Sometimes, by the way, in such schemes use real contracts, but the declared value of imported goods is overstated at times, to send abroad more money. The product itself in this case, duty-free, that the declarant did not get to additional customs fees.

Such a channel was recently closed in the Kaliningrad region. According to the representative of the FCS Elena Ladinos, one entrepreneur bought the machine in Europe for the production of printed circuit boards, increasing their value tenfold. It is possible that the provision of such services for some traders is an additional extra earnings.

The second common method. The company provides overseas affiliated counterparties loans in foreign currency, which are simply displayed, including offshore. According to the Central Bank, only in the last five years the amounts are not refunded means in the terms established by credit agreements, amount to tens of billions of dollars.

In the state Duma there is a government bill providing for the obligation for the repatriation (return) by residents on their accounts in authorised banks of money owed in accordance with the terms of loan agreements. For failure to comply with this rule will be very significant penalties: up to 100% of the amount of the unpaid borrowings. In case of return of a loan in violation of term fine is 1/150 of the refinancing rate of the Central Bank of the loan amount. In fact we are talking about doubling the amount is not returned in the term of the loan to be paid into the Treasury.

Simultaneously, the Finance Ministry has prepared amendments, according to which customs officers and tax specialists will be able to admit in court the nullity of sham transactions.

If it helped or not is unknown. Now for violation of currency legislation and so provides for liability up to a real prison term, but the number initiated by the customs authorities of cases (260 criminal and administrative 5 thousand in 2015), as well as the amount of fines are not very large. Especially given the extent of the problem.

In General, government measures may well be regarded as “flowers”. The Communist faction in the state Duma proposed a much more stringent enforcement against illicit export of capital. For example, authorization to perform foreign exchange operations, not related to the export and import of goods and services, the imposition of restrictions on the acquisition of legal entities, except banks, and citizens of a foreign currency, except for payment of contracts, credits and loans. Finally, the mandatory sale by residents 100% of foreign currency revenue credited to their accounts in the banks.

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