Monitoring of the Federal Legislation dated 31.03.2006

Decree of the President of the Russian Federation No. 276 of March 29, 2006 on the Call up in April-June 2006 to the Military Service for the Citizens of the Russian Federation and Dismissal of Draft Servicemen from the Military Service

From April 1 to June 30, 2006, envisages the call up to the military service for the pertinent citizens of the Russian Federation aged 18 to 27 years other than those being in the reserve in the amount of 124,550 persons. In the previous year, the amount was expected to be 157,700 persons in this period.

Non-rated men, sergeants and sergeant-majors with expired length of draft service must be dismissed.

The Decree is entered into force from the day of its official publication.

Decision of the Government of the Russian Federation No. 163 of March 24, 2006 on the Amendments to the Decision of the Government of the Russian Federation No. 292 of May 7, 2005 and No. 496 of August 9, 2005

The coefficient of indexing of compensations and other payments to citizens having been exposed to radiation because of the disaster at the Chernobyl Nuclear Power Station is fixed in the amount of 1.1 (earlier, 1.08).

The increased coefficient will be used in the monthly, annual and lump sum compensations and other payments specified in the Law of the Russian Federation on the social protection of citizens having been exposed to radiation because of the disaster at the Chernobyl Nuclear Power Station subject to indexing in 2005, as well as the monthly monetary payments in increased amounts of pensions and allowances to non-working pensioners and invalids, invalid children depending on the time of living on the territories having been exposed to radio active contamination because of the disaster at the Chernobyl Nuclear Power Station subject to indexing for the period from May 29 to December 31, 2004 and from January 1, 2005. The surplus of compensations and other payments having formed because of the increase of the coefficient of indexing will be paid out in 2006.

Letter of the Department of the Tax and Customs Tariff Policy of the Ministry of Finance of the Russian Federation No. 03-03-04/2/82 of March 17, 2006 on the Determination of the Date of Recognition of Expenses Accepted for Exemption in the Form of the Sums of the Value Added Tax Paid by the Bank at Purchase of Collection Coins

From January 1, 2006, the moment of determination of the taxable base for the VAT purpose is the earliest of the dates of dispatching or payment. The banks may include in expenses accepted for exemption for the profit tax from organisations amounts of tax paid to suppliers for the purchased commodities (works, services). In this case, the whole of the tax obtained in operations subject to taxation must be paid to the budget.

Thus, when the bank endorses the mentioned procedure of calculation of tax in the accounting policy for the year 2006, the transfer of the tax to the budget for operations subject to taxation shall be made as soon as the payment is received. Amounts of tax paid for commodities (works, services) including the fixed assets and non-material assets purchased for the bank's main operational activities shall be included in expenses accepted for exemption in the calculation of the profit tax from organisations.

Expenses accepted for exemption in the calculation of the profit tax from organisations shall also include VAT amounts paid at the purchase of collection coins.

Letter of the Department of the Tax and Customs Tariff Policy of the Ministry of Finance of the Russian Federation No. 03-03-04/1/207 of March 13, 2006 on the Procedure of Registration for Taxation Purposes of Author Remuneration to Employees for the Employer Intellectual Property Created in the Framework of Execution of Labour Duties

Expenses of organisation to pay out author remuneration to employees as a rights cession for the inventions created by them may reduce the taxable base for the profit tax in the labour remuneration expenses if the mentioned payments (remuneration) are envisaged in the labour contract.

Letter of the Department of the Tax and Customs Tariff Policy of the Ministry of Finance of the Russian Federation No. 03-03-04/1/154 of March 2, 2006

Remuneration to piece and time workers for non-working holidays may be included in the labour remuneration expenses in the calculation of the profit tax if the amount of such payment is specified not only in the local normative act of the organisation, but also in the labour (collective) contracts.