Russia's Largest Yacht Dealer Accused Of Smuggling Vessels

by Lorys Charalambous, Tax-News.com, Cyprus

04 September 2009

Managers of Russian luxury yacht importer - the Burevestnik Group - have been detained on charges of smuggling high-value yachts from the UK and Italy in order to avoid paying customs duties on the vessels during 2007-09.

Burevestnik is thought to be the largest company of its kind in Russia, reportedly accounting for between 40-50% of the market.

According to a statement from Russia’s investigative committee, obtained by Russian news organizations, a total of nine people were detained, including founders, managers and staff from the Burevestnik Group, and a member of the Federal Customs Service’s central administration.

The statement confirmed, according to the St Petersburg Times, that the suspects allegedly evaded customs duties on high-value vessels imported from Britain and Italy between 2007 and 2009.

In Russia yachts attract a 30% custom duty when imported by individuals, and a 42% duty when imported by companies and organizations. Prosecutors reportedly allege that in order to reduce the amount of tax Burevestnik paid over the period, Andrei Boiko, a major shareholder, knowingly underestimated the value of yacht imports.

In a statement on the group’s website quoted by news agency RIA Novosti, the firm denied any wrongdoing, and underscored that no smuggling had taken place.

"Burevestnik Group considers the incident [arrests] that took place on September 2 to be a misunderstanding which will be cleared up in the near future," it is said to have argued.

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