[Mb-civic] Aide criticises Putin over Yukos BBC

[Michael Butler]

 Aide criticises Putin over Yukos
 The economic adviser to Russian president Vladimir Putin has expressed
misgivings about the way oil giant Yukos has been pursued over tax bills.

 The latest tax demand, $950m (£553m), was delivered to Yukos' Siberian
subsidiary Yugansk on Wednesday.

 It adds to large Yukos bills for 2000, 2001, and others for 2002-2004 to
come.

 Andrei Illarionov told the Financial Times newspaper the Kremlin had
"opened a Pandora's box and it was a serious mistake to open it".

 "If such an error has been committed, it would be a smart move to close it
straight away," he added.

 'Wrong steps' 

 He said the affair had taken on "its own logic" and that it would be hard
to find "a political force" to stop the process.

 "Each new wrong step brings more new wrong steps," he told the FT.

 "The escalation of wrong steps, the escalation of mistakes, has dire
consequences for the company, for the industry, for the authorities, and for
the country as a whole."

 He said since Yukos founder Mikhail Khodorkovsky was arrested last October
there had been fear among certain groups of Russian business people.

 Mr Illarionov, a liberal economist brought into the Kremlin in 2000, added
that "while foreign investors remain welcome in the country, they must tread
carefully in oil and gas sector".

 On Friday, executives from Yugansk meet Russian ministers to examine the
terms of its 26 oil licences.

 Court case 

 Bailiffs have been threatening to sell the outlet, Yukos' main oil
producing unit in Siberia, to recover tax debts.

 Interfax news agency said the issue of withdrawing Yugansk's production
licences may be discussed.

 The business accounts for one million barrels of oil daily - 60% of Yukos'
output.

 On Wednesday, Russian officials told the Interfax news agency that Yukos
had paid three-quarters of its total tax debt of $3.4bn for 2000.

 At the same time there was the new Yugansk-based tax demand for Yukos,
whose main owner Mikhail Khodorkovsky is on trial for fraud and tax evasion.

 The government is also chasing a $4.1bn claim from Yukos for taxes from
2001.

 Story from BBC NEWS:
 http://news.bbc.co.uk/go/pr/fr/-/2/hi/business/3723348.stm

 Published: 2004/10/07 12:40:59 GMT

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