The court rejected an appeal by the Russian subsidiary of PricewaterhouseCoopers, one of the 'Big Four' international auditing firms, submitted against Russian tax authorities.
On February 2006, Russian tax authorities accused the auditor of illegitimately underrating its profit tax base in 2002 by transferring money to the Dutch PricewaterhouseCoopers Russia B.V. for services provided by foreign specialists to Russian clients. The tax authorities claimed that in reality the services were provided by staff of the auditor's Russian subsidiary.
PWC applied to a Moscow arbitration court, which rejected the company's lawsuit, after which the auditor made full payments on the 2002 back tax claim and filed an appeal to the Higher Arbitration Court, which sent the case for retrial.
However, the Moscow arbitration court upheld the previous ruling on the 2002 back tax claim against the company.
In a similar case, auditor Ernst & Young said last week it had received a back tax claim for over 390 million rubles ($16 million) in Russia for allegedly underrating its 10.5 million ruble ($400,000) profit for 2004 by 630.3 million rubles ($24 million).
The company said the sum was for the payment of services rendered by its parent company in Cyprus as personnel had been involved in the audits of Russian clients. However, the tax authorities said the company's claim that payment had been made to consultants outside of Russia was ungrounded.
