Nikita Deinega has discusses the application of Article 54.1 of the Tax Code at the #SPIBAtaxTalks event

On 27 April, the Finance Committee of the St Petersburg International Business Association (SPIBA) held a discussion on “Article 54.1 of Tax Code of the Russian Federation : Current Application Practice”. The event was dedicated to the resonance Letter № BV-4-7/3060@ of the Russian Federal Tax Service dated 10.03.2021, in which Article 54.1 of the Tax Code was considered as a general anti-abuse provision aimed at combating tax abuse and unjustified tax benefit.

At the meeting experts discussed the Letter and its impact on taxpayers, shared their practical experience of implementing Article 54.1 of the Tax Code and answered questions from the business community.

Nikita Deynega, Senior Associate and Head of Tax and Administrative Law Practice at Maxima Legal, addressed in his speech the criterion of real damage to the budget system as a prerequisite for application of Article 54.1 of the Tax Code. Using examples of actual court cases, the expert demonstrated how the absence of real damages caused to the budget system allowed taxpayers to withstand claims of fiscal authorities.

Furthermore, Nikita has assessed the prospects of applying the criterion in the context of the Letter No. БВ-4-7/3060 of 10.03.2021 by the Federal Tax Service of Russia, and has identified potential problems of enforcement arising from the approaches proposed by the tax authorities.