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. Last Updated: 07/27/2016

Low-Level Officials Blamed for Tax Overcharge

In a Kafkaesque tale of a bureaucracy run amok, lower-level customs inspectors are still forcing foreigners to pay 60 percent duty to import and export personal possessions in violation of Russia's customs rules.

The State Customs Committee's top legal expert, Vladimir Galdin, said Wednesday that customs inspectors poorly comprehend the rules and that foreigners do not have to pay duties to move personal possessions into and out of Russia. He vowed to enforce the proper rules and refund hundreds of thousands of dollars paid by foreigners since January when a new rule was improperly implemented.

Yet on Thursday, local customs officials such as Vladimir Chernoshev, acting director at one of Moscow's customs docks, continued to misapply regulations with stubborn vigor.

"Foreigners have an obligation to pay the 60 percent tax," Chernoshev said, dressed in the official uniform of blue pants and a white shirt. "Everything that comes from abroad is categorized just as 'goods' and there is no difference for personal possessions."

Galdin, head of the legal department at the State Customs Committee, said Chernoshev and other local customs officials have no right to assess this duty. In practice, however, local inspectors have the last word in deciding whether cargo gets beyond the customs house.

International goods sent to Moscow are typically sealed at the port of origin and only inspected when they arrive at one of several customs houses in the Russian capital.

Because local inspectors have insisted on the 60 percent duty since January, Western moving companies are shelling out thousands of dollars a day in cash to city inspectors and then billing their clients.

Typically, the 60 percent duty amounts to several thousand dollars per move, which has added up to a total of several hundred thousand dollars in cash payments since January, moving company officials say. One executive recently had to pay $16,000 for his household possessions to pass customs.

Echoing a theme common among customs officials asked about the charge, Chernoshev said, "I cannot answer for the whole system" and added, "I am just following orders."

"Just following orders" for Reuters correspondent Ralph Boulton meant a last-minute 60 percent duty to get his household goods out of the country last month. Reuters office administrator Corrine Mauzac, still annoyed about the incident two weeks later, said she finally declared a low value on the shipment, making the company liable for $900 in duty to complete his move.

"I was pretty outraged," Boulton said in an interview from England. "We'd been told nothing about it and we were unable to get a consistent portrayal of what the tax was and how it was to be applied."

The customs law change was aimed at cracking down on those sneaking in commercial goods as personal possessions. Yet Chernoshev and other Moscow inspectors concluded that the 60 percent tariff included foreigners' genuine personal possessions -- and they did not accept any other interpretations.

"It is not possible to speak with these people," said Mikhail Solovyov, customs manager for Corstjens, a moving company. "They are really bureaucratic -- so much so that you can't imagine."

Moving companies have also been reluctant to fight back because poor relations with local inspectors can tie up their shipments and mean the difference between profit and a loss on a move.

Such financial considerations mean that the moving companies sometime act contrary to their client's interests, Mauzac said. When Reuters hesitated to pay the 60 percent duty for Boulton, the moving company threatened to charge $700 for unloading the truck and holding up the shipment, she said.

"I'm very unhappy with the removal company," Mauzac said. "We were blackmailed really."

Galdin of the State Customs Committee again promised Thursday to straighten out the situation within days.