UPDATE2: Cherkizovo says has technical dispute with fiscal services

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MOSCOW, Sep 21 (PRIME) -- Russian meat producer Cherkizovo has some “technical disagreements” with fiscal authorities regarding application of tax rates, a representative of the company told PRIME on Thursday.

Earlier on Thursday, a source in law enforcement authorities told PRIME that executives of Cherkizovo are suspected of tax evasion leading to a loss of 300 million rubles as the company failed to fulfill tax liabilities.

“Technical disagreements emerged between fiscal authorities and the management of the company due to changes in application of tax rates on dividend payments…These changes were not timely explained to the management of the company, and auditors of the company failed to pay attention to the new regulations in time,” the representative of the company said.

The company paid all accrued taxes and penalties immediately after they had been informed about new regulations. “Currently, the management of the company is actively cooperating with fiscal and audit authorities, it provides all necessary data and documents to them,” the person said.

A source close to the company told PRIME that the company redeemed the 300 million tax debt and penalties in July. “So far, the company has no complaints (against the tax service), and it wishes to settle the dispute in a normal way…It was really a technical story of the service accruing an additional tax on dividends retrospectively, and the company redeeming it,” the source said.

The source also said that law enforcement authorities came to Cherkizovo to inspect their documents only after a tax evasion case had been launched. “No law enforcer had filed any requests before that, no one had demanded any documents,” the source said.

An official of the Interior Ministry confirmed earlier on Thursday that the authority had found out a 300 million ruble tax fraud in an agricultural company but did not disclose the name of the suspected holding.

Spokeswoman for the ministry Irina Volk said that the suspects allegedly used offshore schemes during payment of dividends to the Cypriot shareholder of the agricultural holding, and this was in fact a ghost company. The scheme reduced the tax rate to 5% from 15%.

The guilty can face six years in prison.

(58.1290 rubles – U.S. $1)

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