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. Last Updated: 07/27/2016

Tolyattiazot Denies Back Tax Charge

Itar-TassA technician working at Lebedyansky's plant in the Lipetsk region. The firm's shares rose 11 percent early Monday.
Tolyattiazot, the country largest ammonia producer, on Monday rejected claims it owed over $100 million in back taxes and blamed on-going investigations into its tax status on the activities of a company connected with Viktor Vekselberg's Renova Group.

The Samara regional Federal Tax Service last week filed a back tax claim of 2.6 billion rubles ($102 million) for 2004 against the chemical plant, Tolyattiazot's acting general director Sergei Korushev told reporters Monday.

The sum includes 1.6 billion rubles in profit tax and 955 billion rubles in value-added tax, he said.

"Everything is being done to suffocate us," Korushev said at a news conference. "The regular checks are paralyzing production and may lead to stoppage of work at our major plants."

Korushev said a previous tax audit for 2003 and 2004, which was conducted in the first half of 2006, resulted in a separate back tax charge of 13 million rubles ($510,000).

Tolyattiazot's lawyer Valery Yeremenko suggested at the news conference that the firm's tax troubles were being caused by a company with links to Renova Group.

"All our trouble started after an offshore company, Tringal Equities, became a minority shareholder in the company," Yeremenko said. "Tringal Equities has initiated so many court cases against the company that four are still pending at present."

Yeremenko said the company viewed Tringal Equities' actions as an attempt at an aggressive takeover, adding that the head of the company, Alexei Kozlov, was recently the head of Renova Orgsintez, which manages Vekselberg's chemical assets.

Renova Group did not respond to requests for comments Monday.

The Federal Tax Service in Samara and Tolyatti also could not be reached for comment.

Mikhail Stiskin, an analyst with Troika Dialog, suggested that the inspections could be connected with increased pressure from a Gazprom-linked company, however.

"We believe that in the long run, Tolyattiazot is most likely to yield control of the company to a Gazprom-affiliated company, mainly Sibur-Mineral Fertilizers," Stiskin said. "Sibur-Mineral Fertilizers has better chances of getting hold of the company."

Rashid Nureyev, spokesman for Sibur-Mineral Fertilizers, declined to comment on the possibility of a takeover.