China considers same tax rate for domestic, overseas firms (AFP)
AFP - Chinese lawmakers have mulled a draft law that would impose a 25 percent income tax on both domestic and foreign firms, eliminating the preferential rate for overseas companies, according to state media.
Russia tax office files suit vs PWC on YUKOS audit (Reuters)
2006.12.26Mon Dec 25, 11:07 AM ET
MOSCOW (Reuters) - Russian tax authorities have filed a suit against the local branch of PricewaterhouseCoopers (PwC) accusing it of producing a false audit for fallen oil company YUKOS, the auditor said on Monday.
PwC said it acted strictly in line with the Russia's legislation and was ready to defend its position in court.
The report in question dated from 2002, prior to the demise of YUKOS, once Russia's largest and most profitable oil firm.
YUKOS was hit with billions of dollars of tax evasion claims in 2003, but many analysts linked the firm's fall to Kremlin forces exacting punishment for the political ambitions of its key owners, now serving prison terms in Siberia.
PwC confirmed an earlier report by Vedomosti newspaper which said the Moscow arbitration court had filed a suit saying the firm had compiled two audits -- one for internal use, warning of illegal actions by YUKOS, and a second one for shareholders.
PwC said in a statement that it had produced two reports but denied it was pursuing double standards, adding that it was following normal professional standards.
"Responsibility of a company management cannot be shifted onto an auditor," PwC in a statement.
The tax inspectorate is demanding cancellation of a contract between the two firms and the payment of $145,000, which YUKOS paid for the audit of its 2002 results, to state coffers, Vedomosti said.
Finance Ministry officials could not be reached for comment on the report.
YUKOS is undergoing a bankruptcy procedure and its remaining assets are due to be auctioned off in 2007 to cover its back tax debts. Tax officials and state oil firm Rosneft are YUKOS's major creditors. Rosneft already controls YUKOS's former top production unit, Yugansk.
PwC is auditing accounts of many major Russian oil and gas firms. On Monday, the firm said its clients were responsible for one-half of Russia's overall gross domestic product ( GDP).
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