Tax agency targeting human rights group

Serious tax claims have been put forward against the Russian-Chechen Friendship Society (RCFS) that works on Chechnya problems, says Izvestia newspaper. Having done an audit, the tax agency came to a conclusion that the RCFS was to pay an additional 1 million roubles as a profit tax on foreign grants which it received to fund its activities.

The RCFS must pay 1,001,651 roubles as a profit tax and penalties for three years (2002-2004) according to the report on the audit the Nizhny Novgorod Federal Tax Service did.

The FTS considered it a violation that no taxes were paid on grants received from the National Endowment for Democracy and the European Commission because neither organisation features on the list of tax-exempt donors approved by the Russian government's decree No 923 of 24 December 2002, RCFS leader Stanislav Dmitriyevskii told Izvestia.

He said the European Commission was in fourth place on the list, and the tax service men did not notice it because of their poor command of English. The National Endowment for Democracy does not feature on the list indeed. "However, subject to an intergovernmental agreement between Russia and the US of 14 April 1992, funds provided by US governmental structures are tax exempt in Russia," says Dmitriyevskii. "The NED gave us US State Department money, i.e. those funds should also be tax exempt."

The FTS press service found it difficult to comment on the claims against the RCFS. However, it confirmed there had been an audit.

Meanwhile, the RCFS has more than once become the subject of close attention on the part of various agencies. On the one hand, RCFS staff and volunteers work in both Chechnya and Russia and the RCFS says its key objective is to stop war in Chechnya. At the same time, the Nizhny Novgorod regional prosecutor's office opened a criminal case in January 2005 concerning the publication of addresses by Aslan Maskhadov and Akhmed Zakayev to the Russian citizenry and the European Parliament in Pravo-zashchita newspaper published by the RCFS and the Human Rights Society. The addresses were supposed to appeal to an overthrow of the constitutional order.

The RCFS says it is going to appeal the tax claims.