03.12.08

The issue of fair wages worries many, especially tax officials who are fighting "grey wage schemes" whereby an employee is paid some or most of his salary under the table.

According to tax officials in a recent court case, the employees of one business received shockingly low official salaries that were several times lower than had been advertised and were below Russia's living wage.

Employees testified that their actual wages were higher than were indicated in the official documents.

However, the court rejected the testimony of workers, because they could only approximate their actual salaries. The court also called into question the tax officials’ wage calculation method: the living wage is set only for use in calculating the minimum wage, and advertisements in the media cannot form a legal basis for calculating the tax base of the unified social tax, insurance fees, and personal income taxes.

The court pointed out that the law does not provide that wages must equal the living wage or even the lowest wages currently prevailing in a particular industry. (The Federal Antimonopoly Service of Western Siberian district decree from October 30, 2008, # F04-6627/2008 (15063-A45-25).

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Source: Российский налоговый портал