Russian Tax Police 'On The Side Of Good', Explain Oligarch Charges

Tatiana Smolenska, Tax-news.com, Moscow

14 July 2000

Accusations of political bias were strongly denied yesterday in a TV interview by the head of the Russian tax police, Vyacheslav Soltaganov, after high-profile criminal charges were levied against the heads of Avtovaz and Lukoil.

Vyacheslav Soltaganov reminded his interviewer that investigations into a number of top groups had been publicly announced at a press conference a year ago, and that the cases were simply the result of the investigations. He denied that the heads of the companies concerned could have been surprised by the charges:

'These gentlemen are probably being a bit tricky. They all say that they first heard about the criminal charges from the media. But we do not work in a vacuum or outside the field of law. The checks on Avtovaz began a year ago and were completed at the end of last year. The managers at Avtovaz knew perfectly well about the contents of the report, because they signed it.'

Soltaganov emphasized that in his opinion everyone should pay taxes, and that the Tax Police were even-handed:

'The Tax Police are on the side of good. We uncover taxes which are unpaid in accordance with the criminal code, and so criminal cases are instituted. Pay your taxes on time. It is not about putting some oligarch or big businessman in the dock or behind bars. As you can see, we do not use our powers of arrest much. This year 4,000 criminal cases were dropped because the accused or the guilty admitted their guilt and paid their taxes in full.'

Soltaganov said that the leaders of LUKoil had visited him the night before, and it appeared that they were prepared to meet the demands of the Tax Police and pay the money. He also clarified that there were no cars produced with duplicate chassis numbers at Avtovaz. It was just that according to their investigations taxes were not paid on the profits from the sale of nearly 300,000 vehicles.

While LUKoil has always had one of the better reputations among leading Russian companies, instituting Western accounting practices early on, and treating minority shareholders noticeably less horribly than many Russian companies, the same cannot be said of Avtovaz, which has been dogged by rumours of mafia involvement and has suffered (as a result, it is said) more than many companies from horrendous cash-flow problems.

As for the tax police, they have a curious reputation in Russia, on the one hand behaving like stereotypical Soviet secret police, with masked, machine-gun-toting commandos surrounding your home in a dawn raid, and on the other hand being seen as a kind of Robin Hood organisation, rooting out anti-social criminals. They even starred in a Russian-style soap called 'No. 8, Ulitsa Pokrovka' (their address in Moscow) modelled on the US 'A Team'

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