Windfall tax for major companies to be introduced in Russia

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Daily Monitoring of the Legislation

Monitoring of the Federal Legislation dated 2.06.2006

Decision of the Government of the Russian Federation No. 330 of May 29, 2006 on the Amendments to Some of the Acts of the Government of the Russian Federation on the Authority of the Federal Body of Executive Power in Charge of the State Regulation of Prices (Tariff Rates)

Amends individual acts of the Government of the Russian Federation pertaining to the sphere of reference of the federal body of executive power in charge of state regulation of prices (tariff rates).

According to the amendments to the Regulation on the Federal Service for Tariff Rates of Russia, the sphere of reference of the Federal Service shall include additionally the authority to endorse:

" rules of application of prices (tariff rates) for the commodities (works, services) of subjects of natural monopolies;
" payment for the technological connection to electric networks included in the joint national (all-Russia) power-supply network;
" limiting minimum and/or maximum levels of tariff rates for thermal power produced by power-supply stations working in combined electric and thermal power-supply regimes;
" tariff rates for the user line provided to user for permanent use regardless of its type;
" tariff rates for the regional telephone connections to the user of a network of fixed telephone communication to transfer voice information, fax messages and data;
" tariff rates (prices) for the services of use of the infrastructure of internal water ways;
" limiting indices of the maximum (minimum) possible change of specified tariff rates for commodities and services of organisations of the communal complex taking into account the mark-ups to tariff rates for commodities and services of organisations of the communal complex on the average for the subjects of the Russian Federation;
" limiting indices of change of the amount of payment for the dwelling space for citizens and the limiting indices of change of the amount of payment for the communal services for citizens by the subjects of the Russian Federation.

The Federal Service for Tariff Rates of Russia shall control, respectively, application of tariff rates and mark-ups of organisations of the communal complex, and, from January 1, 2007, shall provide pre-trial regulation of disputes and differences between the subjects of natural monopolies, consumers of services of natural monopolies and the bodies of executive power of the subjects of the Russian Federation pertaining to the fixing and application of regulated prices (tariff rates) in compliance with the legislation on natural monopolies.

The amendments to the Decision of the Government of the Russian Federation No. 109 of February 26, 2004 on the price forming for electric and thermal power in the Russian Federation changed the time limits for the endorsement by the Federal Service for Tariff Rates of Russia the limiting minimum and/or maximum levels of tariff rates for subsequent year. They must be specified before the introduction of the given draft federal law to the State Duma of the Federal Assembly of the Russian Federation, rather than the moment of adoption of the federal law on the federal budget for the subsequent year in the first reading.

The fixing of the payment for the technological connection to the regional distribution eclectic networks is included in the sphere of reference of the body of executive power of the subject of the Russian Federation in charge of the state regulation of tariff rates.

Letter of the Department of the Tax and Customs Tariff Policy of the Ministry of Finance of the Russian Federation No. 03-03-04/1/429 of May 10, 2006

If the equipment - means of communication received as a contribution in the registered capital - is in compliance with specified requirements as confirmed outside the territory of the Russian Federation by its producer or seller, and there is not need to confirm it in the Russian Federation in compliance with international treaties, expenses of the organisation receiving it for additional certification of the given equipment are not taken into account for profit taxation purposes.

Letter of the Department of the Tax and Customs Tariff Policy of the Ministry of Finance of the Russian Federation No. 03-03-04/1/404 of April 27, 2006

Lists the documents that may be used to confirm car parking expenses. Such documents may include a slip for car parking endorsed by the Letter of the Ministry of Finance of Russia No. 16-38 of February 24, 1994. If the car parking uses cash registers for cash payments, the cash slip may serve as a document of confirmation.

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