Organization of the VAT taxation and tax control system in the digital economy

Protasova Inna Ivanovna PhD in Economics Protasova I.I. docent of the Department of Economic theory, economics and management, candidate of Economics, Associate Professor Admiral Ushakov State Maritime University 353906, Russia, Krasnodar Territory, Novorossiysk, Menzhinsky str., 19 ii.Protasova@mail.ru

Introduction

In the context of the development of digitalization of the activities of tax authorities, tax administration is being modernized by expanding the possibilities of using analytical information systems of the Federal Tax Service of Russia. The goal is to create comfortable conditions for the implementation of activities, including foreign economic ones, for bona fide taxpayers and to increase the effectiveness of tax control aimed at suppressing and preventing the commission of tax offenses. Currently, there are more than 70 online services on the official website of the Federal Tax Service of Russia.

The mission of the Federal Tax Service of Russia is high quality services and comfortable conditions for paying taxes while effectively countering schemes of illegal tax evasion to ensure fair and equal business conditions for all.

The issues of the organization of VAT taxation, tax reimbursement, including through the application of the application procedure, confirmation of the validity of the application of the 0 percent rate are relevant for taxpayers who work in the field of maritime business, sell goods for export and provide transshipment services, international transportation of goods, freight forwarding services. This category of economic entities is already actively using electronic document management when interacting with each other and with tax authorities.

Taking into account the legislative change in the conditions for applying the VAT refund application procedure, shortening the time for conducting desk tax audits, simplifying the procedure for preparing registers of documents confirming the 0 percent rate through the use of information services of the Federal Tax Service, there is a need for detailed study of this issue.

The purpose of the study is to determine the procedure for reimbursement of value added tax and the specifics of providing documents for the application of a zero VAT rate in the context of digitalization of the economy.

Methods: in the course of the study, a review of regulatory documents was carried out through the use of methods such as analysis, comparison and generalization.

Results

According to the existing procedure, VAT payers are required to submit to the tax authorities at their place of registration a tax declaration in an electronic format via telecommunication channels through an electronic document management operator, in compliance with the established deadline: the declaration must be submitted no later than the 25th day of the month following the expired tax period.

A desk tax audit is conducted within two months in accordance with Article 88 of the Tax Code of the Russian Federation, at the end of which appropriate decisions are made.

In order to reduce the administrative burden on economic entities, increase business activity and create more comfortable tax administration conditions for bona fide taxpayers with respect to VAT tax returns that contain an application for reimbursement of tax amounts from the budget, a desk tax audit can be completed after one month from the date of submission of the VAT tax return.

The letter of the Federal Tax Service of Russia No. ED-20-15/129 dated 06.10.2020 establishes the conditions for the application of an accelerated procedure for checking and refunding VAT, in particular, the absence of errors and (or) contradictions in the tax declaration, the absence of signs of violations of the legislation of the Russian Federation on taxes and fees, the indicators of tax deductions and taxes paid are determined. It is worth emphasizing that the tax authority evaluates compliance with the conditions no later than 10 calendar days from the date of submission of the VAT tax return.

If the desk control reveals signs that indicate a possible violation of the legislation on taxes and fees, the head of the tax authority or his deputy may decide to increase the duration of the desk tax audit by another month.

The application of VAT on the sale of goods in the Customs Union is carried out in accordance with the Protocol on the procedure for collecting Indirect Taxes and the mechanism for controlling their payment during the Export and Import of Goods, performance of works, provision of services, given in Annex No. 18 to the Treaty on the Eurasian Economic Union dated 05/29/2014.  The member States of the Eurasian Economic Union (EAEU), in addition to the Russian Federation, are the Republic of Belarus, the Republic of Kazakhstan, the Republic of Armenia and the Kyrgyz Republic.

In relation to tax returns of participants in foreign economic activity, the tax authority carries out tax control measures, which are regulated by the Tax Code of the Russian Federation and should be aimed at confirming the validity of the application of the 0 percent tax rate and tax deductions (Figure 1).

Figure 1 – Organization of tax control

The Tax Code of the Russian Federation establishes the conditions, procedure and reasons for sending requests for explanations and (or) documents (Table 1).

Table 1 – Grounds for tax control measures

Tax declarations, explanations and VAT documents are sent in electronic form via telecommunication channels through an electronic document management operator according to the formats established by the Federal Tax Service of Russia (Orders of the Federal Tax Service of Russia dated 12/16/2016 N MMV-7-15/682@ "On approval of the format for submitting explanations to the value added Tax declaration in electronic form", dated 10/29/2014 N MMV-7-3/558@ "On approval of the form of the value added tax return, the procedure for filling it out, as well as the format for submitting the value added tax return in electronic form"). It should also be taken into account that declarations and explanations are not considered submitted if they are submitted to the tax authorities in violation of the established format, or on paper.

The implementation of the National Program "Digital Economy of the Russian Federation" has allowed the transition of most enterprises (and the transport industry, among others) to digital rails, increase electronic document flow, and expand information exchange between customs and tax authorities.

The concept of the development of electronic document management in business activities (approved by the decision of the Presidium of the Government Commission on Digital Development, the Use of Information Technologies to improve the quality of life and business conditions, protocol No. 34 dated 12/25/2020) provides for the transfer of 95 percent of invoices issued by business entities and 70 percent generated by the end of 2024 into electronic form transport and consignment notes.

Digitalization of the document flow of financial and economic activities will make it possible, while reducing the time of verification, to identify risks in a timely manner, reduce the number of errors associated with document processing and automate tax control measures.

Taxpayers can reimburse VAT on an application basis subject to the conditions established by Article 176.1 of the Tax Code of the Russian Federation (Figure 2).

Figure 2 – The application procedure for tax refund

Federal Law No. 67-FZ dated 03/26/2022 "On Amendments to Parts One and Two of the Tax Code of the Russian Federation and Article 2 of the Federal Law "On Amendments to Part Two of the Tax Code of the Russian Federation" added the right to apply the application procedure on the basis of a taxpayer's application for the tax periods 2022 and 2023. Taxpayers have the right to apply the declarative procedure for tax reimbursement in the amount claimed for reimbursement, not exceeding the total amount of taxes and insurance premiums (excluding the amounts of taxes paid in connection with the movement of goods across the border of the Russian Federation and as a tax agent) paid by the taxpayer for the calendar year preceding the year in which the application is submitted the statement. In order to exercise such a right, taxpayers should not be in the process of reorganization or liquidation, and insolvency (bankruptcy) proceedings should not be initiated against them in accordance with the legislation of the Russian Federation on insolvency (bankruptcy).

As a practical example, we give the following data. For the 1st quarter of 2022, 1951 taxpayers applied for tax refund under the new application procedure. 1903 positive decisions were made in the amount of 116.5 billion rubles and 206 negative decisions in the amount of 5.7 billion rubles (non-compliance with established conditions, violation of tax legislation, including the presence of unresolved discrepancies, accounting for transactions that distort the facts of economic activity, concealment (understatement) of taxable objects) ^[10].

After the application for the application of the declarative procedure for tax refund is submitted, the tax authorities, within five days, necessarily carry out measures to verify the taxpayer's compliance with the established conditions, and decide on the reimbursement of the amount of tax claimed for reimbursement in the declarative order or on the refusal to reimburse the amount of tax claimed for reimbursement in the declarative order I'm fine.

Discussion

In this article, the author provides a brief overview of the actions of the tax authority to implement the procedure for reimbursement of VAT amounts by taxpayers. As a result of the study, it was determined that the new working conditions, both for taxpayers and directly for tax authorities, required a restructuring of the mechanism of work of tax officials in terms of the active use of digital technologies. 

We emphasize that the electronic document management system provides not only a faster and better exchange of information with counterparties, tax authorities and other public authorities. In the presence of such a document flow, the company is given the opportunity to obtain quick and convenient access to absolutely all electronic documents.

To confirm the validity of the application of the 0 percent tax rate for the sale of goods (works, services), a taxpayer may submit to the tax authority registers of documents in an established format in electronic form via telecommunication channels through an electronic document management operator. The data of the service of the Federal Tax Service of Russia "Verification of the fact of receipt from the Federal Customs Service of Russia of information on documents necessary to confirm the validity of the application of the 0 percent VAT tax rate (excise duty exemption)" can be used by taxpayers to verify the correctness of the register formation.

In order to improve electronic interaction and eliminate inconsistencies and errors in the registers submitted by taxpayers, when compared with data received from the Federal Customs Service of the Russian Federation, the information service "Exporter's Office" is being developed. To access the "Exporter's Office" service, click on the link: https://test-lke.nalog.gov.ru .

The purpose of creating this service is to solve the following tasks presented in Figure 3.

Figure 3 – Tasks of the Exporter's Office service

The service is designed to optimize the processes of interaction between tax authorities and taxpayers by providing access to information resources of the Federal Tax Service of Russia using the Internet.  The Exporter's Office is a system for preparing registers of declarations for goods to be sent to the tax authority.

It is worth emphasizing that the issues of digitalization of the work of tax authorities today are focused on taxpayers and are aimed at simplifying administration, transparency of taxation and voluntary performance of duties.

Conclusion

Based on the above facts, the author comes to the conclusion that today there is a restructuring and development of the mechanism of the economic system in terms of its digitalization. This implies the need for further active implementation of electronic document management in the work of both taxpayers and tax authorities, which corresponds to the Mission of the Federal Tax Service of Russia and the objectives of the Concept of the Strategic Map of the Federal Tax Service of Russia for 2021-2023.

 Amendments to Article 176.1 of the Tax Code of the Russian Federation in terms of granting the right to apply the application procedure on the basis of a taxpayer's application, subject to the conditions established by the Tax Code of the Russian Federation, allowed to increase the number of taxpayers who received a tax refund in 2022, without waiting for the end of the in-house tax audit. It should also be noted that this made it possible to reduce the costs of economic entities to pay interest for using a bank guarantee.  However, during the study, it was found that due to non-compliance by taxpayers with the conditions, tax authorities in 10% of cases in the amount of 5.7 billion rubles. decisions were made to refuse to reimburse the amount of tax claimed for reimbursement in the declarative order ^[10]. Illegal reimbursement or an attempt to reimburse tax by providing fictitious documents and false declarations is qualified under Article 159 of the Criminal Code of the Russian Federation as embezzlement or attempted embezzlement of funds from the budget. In this regard, it seems advisable to develop a separate service or make additions to the functionality of existing ones, allowing the taxpayer to assess the possibility of applying the application procedure before forming and submitting a declaration. The specified offer can be implemented by checking the right individually, similar to the functionality of tax calculators, indicating the INN, tax period and the estimated amount of compensation. It is also necessary to emphasize the importance of disclosing information on the website about the methodological aspect of taxation and VAT refund, giving examples of mistakes and offenses.

The use of the Office Exporter service by organizations applying the 0 percent VAT rate will allow, while reducing the cost of paper document management, to form registers of supporting documents as quickly and correctly as possible. This direction of development of modern communication methods will eliminate errors, increase the efficiency of the desk tax audit and lead to a reduction in its time.

However, despite significant achievements in expanding the possibilities of using information services, the possibility of confirming the 0 percent rate in the provision of transshipment services, international transportation of goods, freight forwarding services based on registers provided for in Article 165 of the Tax Code of the Russian Federation has not been realized. It is considered advisable to develop and implement a classifier of transport, shipping or other documents that confirm the export of goods from the Russian Federation (import of goods into the Russian Federation). The classifier must contain the main details of the documents actually issued when providing services based on the specifics and legal conditions of documentary confirmation for each type of service. The expansion of the service's capabilities will allow economic entities to use the classifier to view the available information on the website provided by the customs authorities and create a register taking into account the specifics of maintaining information resources of customs and tax authorities.

The procedure for using the Office of the Exporter service in terms of communication between the taxpayer and the tax authority, the format of questions initiated by the Federal Tax Service of Russia through the service, the timing of information exchange, the obligation to provide answers and the responsibility of taxpayers are not established by the regulatory framework, which makes this issue relevant for further research in this area.