Article 96. Recruiting a Specialist for Assisting in Exercising Tax Control

1. If needed, specialist that posses special knowledge and skills and have no interest in the outcome of the case can be recruited on a contractual basis to assist in conducting specific tax control actions including during the conduct of field tax checks .

2. Specialists shall be recruited on a contractual basis.

3. Participation in the case of a person in the capacity of a specialist shall not preclude a possibility for interrogation of this person, concerning the same case, as a witness.

Article 97. Participation of an Interpreter

1. Where necessary, an interpreter can be recruited on a contractual basis to assist in exercising tax control.

2. An interpreter shall be a person who has no stake in the outcome and has the command of the language required for interpretation.

This provision shall also apply to a person who understands the signs of the mute or the deaf.

3. The interpreter shall arrive as summoned by the tax official who appointed him/her and adequately perform the interpretation.

4. The interpreter shall be briefed on the liability for refusal or avoidance to fulfill his duties or for providing a fraudulent interpretation, which shall be recorded in a protocol signed by the interpreter.

Article 98. Attesting Witnesses

1. When conducting tax control actions, in cases provided for in the present Code, attesting witnesses shall be summoned.

2. At least two attesting witnesses shall be summoned.

3. Any natural persons having no stake in the outcome of the case may be summoned as attesting witnesses.

4. Tax officials shall not be allowed to act as attesting witnesses.

5. Attesting witnesses shall attest to the fact, content and results of actions performed in their presence, in a protocol. They shall have the right to comment on the actions performed, and such comments shall be entered into the protocol.

If needed, the attesting witnesses may be interrogated on the above circumstances.

Article 99. General Requirements to Protocols of Tax Control Proceedings

1. In cases stated in the present Code, tax control proceedings shall be recorded at the time of the proceedings in protocols. The protocols shall be drawn up in Russian.

2. The protocol shall state the following:

1) the title thereof;

2) date and place of proceedings;

3) time of beginning and end of proceedings;

4) position and name of the person who drew the protocol;

5) full name of every person who assisted in or was present at the proceedings; and, if necessary, their address and citizenship, and their command of the Russian language;

6) content and sequence of proceedings;

7) material facts and circumstances that were identified in the course of the proceedings.

3. The protocol shall be read by all those who assisted in, or were present at the proceedings. The said persons shall have the right to make comments which shall be entered into the protocol or attached to the file.

4. The protocol shall be signed by the tax officer who drew it, as well as by all those who were either present at, or assisted in, the proceedings.

5. Attached to the protocol shall be photographs and negatives, films, videotapes and other materials that were produced during the proceedings.

Article 100. Reporting Field Audit Results

1. Based on the results of a field tax audit not later than two months after the compilation of the reference on the carried check, the authorized tax officials shall draw up an act of tax audit of the established form that shall be signed by these officials and the head of the audited organisation (if taxpayer is a legal entity) or the individual entrepreneur, or by their representatives. If the representatives of organisations refuse to sign the act, a record of this shall be made therein. If the indicated persons avoid receiving the Tax Audit Act this shall be reflected in a report of tax checking.

2. Indicated in the tax audit act shall documented facts of tax offences revealed during the audit or the absence thereof, as well as conclusions and recommendation of the auditors on elimination of the revealed breaches and references to the Articles of this Code, which provide for responsibility of this type of tax offences.

3. The form of the tax audit act and the requirements to drawing it shall be established by the Ministry of Taxation of the Russian Federation.

4. The tax audit act shall be served to the head of the organisation, if the taxpayer is a legal entity, or the entrepreneur, if the taxpayer is a natural person, engaged in entrepreneurial activities, (or their representatives) without forming a legal entity, against subscription, or delivered in some other way that testifies of the date of its receipt by the taxpayer or its representatives. If the tax audit act is mailed by registered mail to the taxpayer, the sixth day after it was sent shall be considered as the date of service.

5. If the taxpayer does not agree with the facts stated in the audit act, or with the conclusions and recommendations of the auditors, he is entitled to file a written explanation of his motives for refusing to sign the act and/or objections concerning the act as a whole or its individual provisions with the appropriate tax authority within two weeks from the data of the receipt of the audit act. The taxpayer is also entitled to attach documents (of certified copies thereof) that confirm the grounds for objections or motives for refusing to sign the audit act to the written explanation (objection) or to deliver them to the tax authority within the agreed time limit.

6. Upon expiry of the time period indicated in the preceding part of this Article and within 14 days from the date of such expiry the head of the tax authority (or his deputy) shall examine the tax audit act, and documents and materials presented by the taxpayer.

Article 101. Proceedings in a Case of Tax Offences Committed by a Taxpayer, a Duty Payer or by a Tax Agent (Rendering a Decision on the Results of Examination of Audit Materials)

1. Checking materials shall be examined by the manager (deputy manager) of a tax body. In the event of submitting by the taxpayer written explanations or objections to the report of a tax check, the materials of the check shall be examined in the presence of the officials of a taxpaying organisation or an individual entrepreneur or of their representative. The tax body shall notify the taxpayer about the time and the place of the examination of the checking materials well in advance. If despite the notification the taxpayer failed to appear, the checking materials, including the objections, explanations and other documents and materials presented by the taxpayer shall be considered in his absence.

2. Based on results of audit materials examination, the head of the tax authority (or his deputy) shall render a decision to:

1) to bring the taxpayer to fiscal responsibility for committing the tax offence;

2) to not to bring the taxpayer to responsibility of committing the tax offence;

3) to conduct additional tax control measures.

3. The resolution on bringing the taxpayer to responsibility for committing a tax offence shall state the circumstances of the tax offence committed by the taxpayer as established by the tax audit, documents and other facts that confirm the said circumstances, arguments brought forth by the taxpayer in his defense and results of verifying these arguments, the decision to bring the taxpayer to fiscal responsibility for concrete tax offences indicating the articles of the law stipulating these offences, and the measures of liability applicable thereto.

4. Based on the decision to bring the taxpayer to responsibility for committing the tax offence, the tax authority sends out a demand for payment, requesting the taxpayer to pay tax arrears, and penalizing interest.

5. A copy of the decision of the tax body and the demand for payment shall be served to the taxpayer or his/her representative, against subscription or are delivered in another way which testifies of the date of the receipt by the taxpayer. If it is impossible to hand in the decision of a tax body to a taxpayer or his representatives by the above-said methods, this decision shall be sent by registered mail and shall be deemed to be received upon the expiration of six days after its dispatch.

6. Nonobservance, by tax officials, of the requirements established in this Chapter, shall constitute grounds for annulling the decision of the tax authority by the higher tax authority or court.

7. With respect to tax offences revealed by the tax authority for which individual taxpayers or officials of corporate taxpayers are punishable under administrative law, the authorized official of the tax authority that conducted the audit draws up a protocol of administrative offence. Examination of such tax cases and application of administrative sanctions with respect to taxpayer officials (if legal entity) or individual taxpayers (if entrepreneurs) at fault shall be conducted by tax authorities in accordance with administrative legislation of the Russian Federation and subjects of the Russian Federation.

8. The provisions of this Article shall also apply to duty payers and tax agents.

Article 101.1. Proceedings in the Case of the Code-stipulated Breaches of the Legislation on Taxes and Dues, Committed by Persons Who Are Not Taxpayer, Duty Payers or Tax Agents

1. Upon the discovery of facts testifying to the violation of the legislation on taxes and dues (including tax offences) by persons who are not taxpayer, duty payer or tax agents, the tax official shall draw up in a statutory manner a report to be signed by this official and the person who has committed a breach of the legislation on taxes and dues. A corresponding entry shall be made in this report to testify the fact of the refusal of the person who has committed a breach of the legislation on taxes and dues to sign this report. When the aid person evades to receive the report, the tax official shall make a relevant entry in the report.

2. The report shall indicate the documentally confirmed facts of a breach of the legislation on taxes and dues, and also the conclusions and proposals of the official who has discovered the facts of breaking the legislation on taxes and dues to eliminate the revealed breaches and to apply sanctions for breaking the legislation on taxes and dues.

3. The form of the report and the demand for its drawing up shall be established by the Ministry of Taxation of the Russian Federation.

4. A report shall be presented to the persons who has committed the legislation on taxes and dues against receipt or conveyed in any other way testifying to the date of its receipt. In the event of sending the said report by registered mail the sixth day beginning with the date of its dispatch shall be deemed to be the date of handing in the report.

5. A person who has committed a breach of the legislation on taxes and dues shall have the right, in case of disagreement with the facts set forth in the checking report, and also with the conclusions and proposals of checking officials, to submit, within two weeks since the day of the receipt of the checking report, to the respective tax body his written explanation of the reasons for the refusal to sign the report or for the objection to the report as a whole or to its particular provisions, In this case the person who has committed a breach of the legislation on taxes and dues shall have the right to append to the written explanations (objections) the documents or their certified copies confirming the validity of objections or reasons for non-signing the checking report or to transfer such documents to the tax body in the agreed period of time.

6. Upon the expiry of the time indicated in Item 5 of this Article, during 14 days the manager (deputy manager) of the tax body shall consider the report which has fixed the facts of breaking the legislation on taxes and dues, and also the documents and materials submitted by the person who has committed a breach of the legislation on taxes and dues.

7. If a person who has breached the legislation on taxes and dues fails to submit explanations of, or objections to, the report, the checking materials shall be examined in the presence of this person or of his representatives. The tax body shall notify the person who has committed a breach of the legislation on taxes and dues about the time and place of the examination of these materials well in advance. If the person who has breached the legislation on taxes and dues has not appeared despite the notification, the report and the materials appended to it shall be examined in his absence.

8. The manager (deputy manager) of a tax body shall pass his decision according to the results of the examination of the report and the appended materials:

1) on the calling to account of a person for breaking the legislation on taxes and dues;

2) on the refusal to call to account a person for breaking the legislation on taxes and dues;

3) on additional measures of tax control.

9. The decision on calling a person to account for breaking the legislation on taxes and dues shall set forth the circumstances of the committed breach, indicate documents and other information confirming the said circumstances, the reasons adduced by the person who is called to account in his defence, and the results of checking these agreements, the decision on calling the person to account for concrete breaches of the legislation on taxes and dues, with an indication of the Articles of this Code which provide for such breaches and the applicable measures of responsibility.

10. A demand for penalty payment shall be forwarded to the person on the basis of the passed decision on calling him to account for breaking the legislation on taxes and duties.

11. A copy of the decision taken by the tax body manager and the demand shall be handed in to the persons who has breaches the legislation on taxes and dues against receipt or shall be conveyed in any other way that testifies to the date of its reception by the taxpayer or by his representative. If a copy of the tax body's decision and/or demand may not be handed in to him, they shall be deemed to be received by the person who has breached the legislation on taxes and dues or by his representative upon the expiry of six days after they were sent by registered mail.

12. Non-observance by tax officials of the requirements of this Article may be a ground for the repeal of the decision of the tax body by a higher tax body or by a court of law.

13. The authorized official of a tax body shall draw up a record of administrative offences about the tax body-revealed breaches of the legislation on taxes and dues, for which persons are liable to administrative responsibility. Cases of these offences and of the application of administrative sanctions to the persons guilty of their commission shall be examined by tax bodies in accordance with the legislation on administrative offences.

Article 102. Taxpayer Confidentiality

1. Any information regarding a taxpayer received [information] by a tax authority, the bodies of the tax police, the agency of the governmental extra-budgetary fund and the customs agency shall be considered confidential, with the exception of the following:

1) information disclosed by the taxpayer at his own discretion or with his consent;

2) information on the TIN;

3) on violations of tax and fee legislation and sanctions for these violations;

4) information provided to tax (customs) or law-enforcement agencies of other nations in accordance with international treaties (agreements) on mutual cooperation between tax (customs) or law enforcement authorities of respective countries (in the part that concerns information submitted to these agencies), to which the Russian Federation is a party.

2. Confidential taxpayer information shall not be subject to disclosure by tax authorities, the bodies of the tax police, the agencies of the governmental extra-budgetary funds and customs agencies, their officials, recruited specialists, or experts, with the exception of cases stipulated in the federal law.

Disclosure of confidential tax information shall include, without being limited to, the use of information, which constitutes a technological or commercial secret of the taxpayer, that came into possession of a tax official, the bodies of the tax police, an agency of the governmental extra-budgetary fund or a customs agency, a participating specialist or expert while performing their duties.

3. Confidential taxpayer information that came into possession of the tax authority, the bodies of the tax police, the agencies of the governmental extra-budgetary funds or the customs agencies shall be subject to special storage and access arrangements.

Access to confidential tax information shall be enjoyed by officials indicated in the authorization lists determined by the Ministry of Taxation of the Russian Federation, the agencies of the governmental extra-budgetary funds, the Federal Service of the Tax Police of the Russian Federation and the State Customs Committee of the Russian Federation.

4. Loss of documents containing confidential tax information, or disclosure of such information shall entail a liability under federal laws.