At its previous session, the Moscow Arbitration Court heard counter-arguments to Yukos' appeal from officials of the federal Tax Ministry. On April 14, 2004, the ministry had prepared a R99,375bln back tax claim against Yukos and went to court the following day with the request that the designated sum be collected from the debtor company. Tax officials claim that Yukos' top management used all kinds of schemes to conceal their earnings and dodge taxes. Many of Yukos' subsidiary companies allegedly got registered in Russian regions offering tax breaks. The affiliates registered in Mordovia, Kalmykia, and Evenkia were exempted from profit, property, and road tax, but were expected, in return, to invest in those republics' economies and to create jobs here. And those registered in the Chelyabinsk, the Nizhny Novgorod and the Sverdlovsk regions were granted tax breaks on condition that at least 70 percent of their assets were placed locally and that local residents formed the bulk of their staffs.
But, according to taxmen, those Yukos subsidiaries ignored their investment commitments. They were actually dummies, which would buy crude from Yukos' production units at discounts and then sell it off at market prices. By so doing, the oil giant saved an estimated 99,375 roubles in unpaid taxes, the Tax Ministry claims.
On May 26 this year, an arbitration court of first instance ruled that Yukos pay 47.989 billion roubles in back taxes and 51.385 billion roubles in penalty fees. The company's defense team appealed the decision with a higher court, which responded by reducing the payable amount by a mere 33 million roubles. Yukos then turned to a court of appeals. On September 2, 2004, the Tax Ministry came out with another claim against Yukos, demanding that it pay off an additional 120 billion roubles in back taxes for 2001. The ministry is now looking into the company's financial operations in 2002.
