Bribes not tax deductible, Russians told

Russian tradesmen have been told by Russia's Finance Ministry that any bribes paid while abroad will not be tax deductible, according to reports.

In a statement posted on the ministry’s website, it said any ‘expenses incurred while committing legal violations, including providing bribes or kickbacks, are not recognized for the purposes of tax assessment,’ The Daily Telegraph reports.

The outcome is that any official paying bribes will be liable for the country’s standard 20% rate of income tax, Russia's Vedomosti newspaper said.

The paper quoted tax officials as saying the clarification was necessary for Russian arms exporters and commodity companies with assets in the developing world.

A 2011 survey from anti-graft group Transparency International showed that Russian and Chinese companies are most likely to hand out bribes when conducting business abroad, The Telegraph reports.

Earlier this year, Russia officially signed up to the Anti-Bribery Convention and became the 39th nation to sign up to its strict rules.

The convention seeks all signatories to ‘criminalise the bribery of foreign public officials to obtain advantages in international business, and subject companies and individuals who engage in such bribery to effective, proportionate and dissuasive sanctions’.

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