PRESS: Russia’s MegaFon offers new 1% tax to finance data storage

MOSCOW, Jul 7 (PRIME) -- Russian mobile operator MegaFon has suggested introducing an additional tax of about 1% from operators’ annual revenue so that authorities themselves would use the money to build storage facilities for user data, business daily Kommersant reported Thursday referring to the company’s CEO Sergei Soldatenkov.

The parliament earlier approved a much-criticized package of antiterrorist bills, stipulating among others an obligation for communications operators and Internet companies to store information on facts and content of users’ activities for some time and provide special services with access to information upon request. To become law the initiative is waiting for being signed by President Vladimir Putin.

“It seems strange to us that the government has decided to hand over a part of its functions to ensure security to private companies. In May, when the bills were still considered by the State Duma (the parliament’s lower house), we with Andrei Dubovskov (president of mobile operator MTS) met with Irina Yarovaya (one of the bills’ authors, head of the security committee at the State Duma) and explained consequences to her,” Soldatenkov said.

“Unfortunately, we were not heard. The bills in their current wording financially kill the telecommunications industry. We cannot fulfill them without shifting a part of expenses on our subscribers; everyone knows it and understands it quite well.”

Soldatenkov hopes the government would issue a ruling with explanations, “which would set more realistic periods for data storage, which MegaFon would fulfil with its own resources without transferring expenses to clients and shareholders.”

“If the bills are kept in their current state, we should spend more than 200 billion rubles, and, for comparison’s sake, our net profit is 50 billion rubles per year,” Soldatenkov said.

“During a meeting with Irina Yarovaya, we with Andrei Dubovskov offered to introduce a new tax for connection operators. We already have the fund of universal services, to which we contribute 1.2% of revenue. We proposed to charge an extra tax so that the government could spend the money on creation of data processing and storage centers. It’s not our task or our function.”

Any tax should be economically profitable both for the government and the operator. “An additional tax of 1% from revenue would have no impact on the industry; everyone would handle it,” Soldatenkov said.

(64.6304 rubles – U.S. $1)

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