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DOI: 10.47026/2499-9636-2021-1-31-43

Zotikov N.Z.

Tax Risks when Doing Business in Russia

Keywords: tax risks, tax inspections, optimization methods, tax benefit, value added tax, counterparty, tax burden, penalties, tax security, risk management

The tax legislation does not contain a clear definition of the term "tax risks". Setting up and expanding a private business is not an easy task. Apart from the idea and a great desire to do business, financial resources are necessary, the investment of which does not always bring benefits. Risks in doing business are on the watch for any entrepreneur, not only a beginner, but that who has been running his business for more than a year as well. When finances are invested in any business, the risk is always present. The causes for tax risks uprising may be: frequently changing tax legislation, in connection with which the business does not have time to master the changing rules of the game in time; failure (late) execution of fiscal liabilities in the manner and time limits provided for by the Tax Code of the Russian Federation; work with unscrupulous partners; transactions between related parties (violation of pricing rules for these transactions); minimizing taxes by applying optimization methods not provided for by the Tax Code of the Russian Federation. Tax risks exist not only for taxpayers, but for the state as well, which is associated with a possible decrease in tax revenues, which are the financial component of the budget. The article provides a classification of risks, factors that cause tax risks in an organization. The level of risk remains high when working with counterparties, and therefore, despite the adoption of Article 54.1 of the Tax Code of the Russian Federation, which replaced the concept of obtaining unjustified tax benefits, the importance of caution and prudence in choosing a counterparty does not become weaker. The author presents the key performance indicators of the control work carried out by the tax authorities for 2016–2019.

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About authors

Zotikov Nikolay Z.
Candidate of Economics Sciences, Associate Professor, Finance, Credit and Statistics Department, Chuvash State University, Russia, Cheboksary (zotikovcontrol@yandex.ru; )

Article link

Zotikov N.Z. Tax Risks when Doing Business in Russia [Electronic resource] // Oeconomia et Jus. – 2021. – №1. P. 31-43. – URL: http://oecomia-et-jus.ru/en/single/2021/1/4/. DOI: 10.47026/2499-9636-2021-1-31-43.