Commentary on Article 245. Evasion of Payment of Taxes and (or) Other Mandatory Payments to the Budget by Organizations of the Criminal Code of the Republic of Kazakhstan
1. Evasion of payment of taxes and (or) other mandatory payments to the budget by organizations through failure to submit a tax return where submission of such return is mandatory, or by entering knowingly distorted information about income and (or) expenses into a tax return, or by concealing other taxable items and (or) other mandatory payments, provided that such act results in non-payment of taxes and (or) other mandatory payments in a large amount, -
shall be punishable by a fine in an amount of up to two thousand monthly calculation indices, or corrective labor in the same amount, or community service for a period of up to eight hundred hours, or restriction of liberty for a period of up to three years, or imprisonment for the same period, with deprivation of the right to hold certain positions or engage in certain activities for a period of up to three years.
2. The same act committed:
1) through the use of an invoice without actual performance of work, provision of services, or shipment of goods;
2) by a group of persons acting by prior conspiracy, -
shall be punishable by a fine in an amount of up to four thousand monthly calculation indices, or corrective labor in the same amount, or community service for a period of up to one thousand hours, or restriction of liberty for a period of up to four years, or imprisonment for the same period, with deprivation of the right to hold certain positions or engage in certain activities for a period of up to three years.
3. Acts provided for in Parts One or Two of this Article, committed by a criminal group or on an especially large scale, -
shall be punishable by a fine in the amount of two to three times the amount of payments not received by the budget, or imprisonment for a period of five to eight years, with deprivation of the right to hold certain positions or engage in certain activities for a period of up to three years.
Note. A person who has committed an act provided for in this Article (with the exception of an act committed by a criminal group) shall be released from criminal liability in the event of voluntary payment of tax arrears and (or) other mandatory payments to the budget, as well as penalties established by the legislation of the Republic of Kazakhstan.
The public danger of the crime lies in the fact that it causes substantial harm to the economic security of the state, obstructs the planned receipt of taxes into the budget, thereby undermining the normal functioning of the economy.
Article 35 of the Constitution of the Republic of Kazakhstan establishes that the payment of legally established taxes, fees and other mandatory payments is the duty and obligation of everyone.
Pursuant to Subparagraph 1) of Paragraph 3 of Article 13 of the Code of the Republic of Kazakhstan dated December 25, 2017, “On Taxes and Other Mandatory Payments to the Budget (Tax Code),” a taxpayer is obliged to fulfill tax obligations in a timely manner and in full.
In this regard, the object of evasion of payment of taxes and (or) other mandatory payments to the budget by organizations is the economic interests of the state in the field of taxation, i.e. public relations concerning the formation of the state budget through legally established taxes and other mandatory payments.
According to Subparagraph 55) of Paragraph 1 of Article 1 of the Tax Code of the Republic of Kazakhstan, taxes are mandatory monetary payments to the budget unilaterally established by the state through legislation, except for cases provided for by the Tax Code, paid in specified amounts and characterized by their non-refundable and gratuitous nature.
Subparagraph 10) of Paragraph 1 of Article 1 of the Tax Code of the Republic of Kazakhstan establishes that other mandatory payments to the budget are mandatory monetary contributions to the budget in the form of fees, charges and duties, with the exception of customs payments, made in the amounts and cases established by the Tax Code.
The types of taxes and payments to the budget are established in Subparagraphs 1)-2) of Paragraph 1 of Article 189 of the Tax Code (see the commentary to Article 244 of the Criminal Code of the Republic of Kazakhstan).
Thus, the subject matter of the crime under consideration consists of mandatory monetary payments to the budget in the form of fees, charges and duties, unilaterally established by the state through legislation, paid in specified amounts and characterized by their non-refundable and gratuitous nature, the list of which is specified in Article 189 of the Tax Code, except for cases provided for by tax legislation.
From the objective side, the crime provided for in Part 1 of Article 245 of the Criminal Code of the Republic of Kazakhstan is characterized by the commission of the following acts:
evasion of payment of taxes and (or) other mandatory payments to the budget by organizations through failure to submit a tax return where submission of such return is mandatory;
evasion of payment of taxes and (or) other mandatory payments to the budget by organizations through entering knowingly distorted information about income and (or) expenses into a tax return;
evasion of payment of taxes and (or) other mandatory payments to the budget by organizations through concealment of other taxable items and (or) other mandatory payments.
Evasion of payment of taxes and (or) other mandatory payments to the budget through failure to submit a tax return, the submission of which is mandatory in accordance with the tax legislation of the Republic of Kazakhstan, takes place when a person, intentionally and for the purpose of non-payment of taxes (payments) to the budget, fails to submit a tax return to the relevant authority after the expiration of the deadlines established by law.
Entering knowingly distorted information about income into a tax return consists of intentionally indicating therein any information that does not correspond to reality, for example, information concerning the amount of income and tax deductions or benefits, the fact of registration as an individual entrepreneur, the existence of an appropriate license, the availability of tax benefits or deductions, and any other information affecting the correct calculation and payment of taxes and other mandatory payments.
Concealment of other taxable items and (or) other mandatory payments to the budget means the intentional failure to reflect, in the relevant tax reporting documents submitted to the tax authorities, actual information about other taxable items and (or) other mandatory payments.
Concealment of taxable items and (or) other mandatory payments should be understood as the complete or partial failure to reflect, in the accounting and tax records of an enterprise, the items and other circumstances with the existence of which the legislation associates the emergence of a taxpayer's obligation to calculate and pay taxes and (or) other mandatory payments.
Concealment of taxable items may be expressed both through the inclusion of knowingly distorted information relating to such items in accounting documents and tax reports, and through the intentional submission to the tax authorities of inaccurate reporting documentation concerning such items.
Paragraph 28, second subparagraph, of the Regulatory Resolution of the Supreme Court of the Republic of Kazakhstan “On Certain Issues of the Application by Courts of Legislation in Cases Involving Criminal Offenses in the Sphere of Economic Activity” states that evasion of payment of taxes and (or) other mandatory payments to the budget by organizations is committed through failure to submit a tax return where submission of such return is mandatory, or by entering knowingly distorted information about income and (or) expenses into a tax return, or by concealing other taxable items and (or) other mandatory payments.
The commission of the crime provided for in Article 235 of the Criminal Code of the Republic of Kazakhstan, “Failure to Fulfill the Requirement of Repatriation of National and (or) Foreign Currency,” when combined with evasion of payment of taxes and (or) other mandatory payments to the budget by organizations, shall be classified under the aggregate of crimes provided for in Articles 235 and 245 of the Criminal Code of the Republic of Kazakhstan.
In cases of evasion of payment of taxes and (or) other mandatory payments to the budget through the use of invoices without actual performance of work, provision of services, or shipment of goods, it is necessary to establish whether there was complicity between the person evading payment of taxes and the person who provided fictitious invoices in the commission of criminal offenses provided for in Articles 216 and 244 or Article 245 of the Criminal Code of the Republic of Kazakhstan.
The provisions of the Tax Code determine the types of taxes and mandatory payments to the budget, the deadlines for their payment, and the taxable items and payment objects.
Paragraph 2 of Article 2 of the Tax Code of the Republic of Kazakhstan establishes that no person may be charged with the obligation to pay taxes and payments to the budget that are not provided for by the Tax Code.
Entering knowingly distorted information about income and (or) expenses into a tax return falls within the elements of the disposition of Article 245 of the Criminal Code of the Republic of Kazakhstan only where such actions are committed through concealment of other taxable items and (or) other mandatory payments, i.e. through the submission of incomplete information about the organization's activities to the tax authorities.
If a person, when submitting a tax return to the tax authorities concerning the activities of an organization, enters knowingly distorted information about the income and (or) expenses of that organization, but does so not through concealment of other taxable items and (or) other mandatory payments, but in another manner, for example, by distorting information about the income and (or) expenses of that organization in relation to property in respect of which the taxpayer does not incur a tax obligation, such actions are not covered by the disposition of Part 1 of Article 245 of the Criminal Code of the Republic of Kazakhstan. At the same time, criminal liability for the commission of a crime may arise if these acts result in non-payment of taxes or other mandatory payments to the budget in a large amount.
An income tax return is an official statement by a taxpayer concerning the income received by that taxpayer during a certain period and the tax deductions and benefits applicable thereto, submitted to the tax authorities using a special form. On the basis of the tax return and the applicable tax rates, the tax authority exercises control over the amount of tax payable.
The types of tax returns are provided for by the Tax Code of the Republic of Kazakhstan, for example, the corporate income tax return, individual income tax return, social tax return, value added tax return, excise tax return, export rent tax return, and others.
According to Paragraph 38) of Article 3 of the Criminal Code of the Republic of Kazakhstan, the amount of unpaid tax shall be considered large if it exceeds fifty thousand monthly calculation indices.
A corporate income tax payer is obliged to submit a tax return to the tax authorities no later than March 31 of the year following the reporting tax period (Article 315 of the Tax Code), with the exception of a non-resident receiving exclusively income from sources in the Republic of Kazakhstan subject to taxation at the source of payment and not carrying out activities in the Republic of Kazakhstan through a permanent establishment, unless otherwise established by Article 315 of the Tax Code.
The corporate income tax return consists of the tax return itself and appendices thereto disclosing information about taxable items and (or) items related to taxation. If taxes and other mandatory payments are not paid in a large amount after the expiration of this deadline, the crime shall be deemed completed.
The amount of unpaid taxes and (or) other mandatory payments shall be determined on the basis of the totality of evidence, including a tax audit report, an opinion of a specialist (expert), and other evidence, regardless of the type of tax and mandatory payment and the deadlines for their payment, with the total amount for the entire period of non-payment being taken into account.
The corpus delicti of evasion of payment of taxes and (or) other mandatory payments to the budget by organizations is, by its legal construction, material in nature, i.e. the crime shall be considered completed when the act results in non-payment of taxes or other mandatory payments to the budget in a large amount. At the same time, as noted by the Supreme Court of the Republic of Kazakhstan, the moment of completion of the criminal offense provided for in Articles 244 and 245 of the Criminal Code of the Republic of Kazakhstan is the day following the last day of the deadline for payment of the tax (payment to the budget) established by tax legislation (Paragraph 32 of the Regulatory Resolution of the Supreme Court of the Republic of Kazakhstan “On Certain Issues of the Application by Courts of Legislation in Cases Involving Criminal Offenses in the Sphere of Economic Activity”).
The subjective side of the crime is characterized by direct intent. The person is aware that they are evading payment of taxes and (or) other mandatory payments to the budget by organizations through failure to submit a tax return where submission of such return is mandatory, or by entering knowingly distorted information about income and (or) expenses into a tax return, or by concealing other taxable items and (or) other mandatory payments; they foresee the possibility or inevitability of the occurrence of consequences and desire their occurrence.
If a person did not have reliable prior knowledge, was not obliged to know, and could not have known about the falsity of the information about income and (or) expenses entered into the tax return due to various reasons (lack of knowledge, erroneous perception, deception by other persons, incompleteness or incorrect perception of facts, etc.), or acted under an honest mistake, or did not reliably know, was not obliged to know, and could not have known that they were failing to fulfill the obligation to submit a tax return, then the subjective elements of evasion of payment of taxes and (or) other mandatory payments to the budget by organizations, provided for in Part 1 of Article 245 of the Criminal Code of the Republic of Kazakhstan, shall be absent from their actions.
The subject of the crime is special: a physically competent individual who has reached the age of sixteen, is responsible for organizing accounting records, and has the right to sign accounting documents. Such persons include the head and chief (senior) accountant, as well as persons who actually perform their duties in an organization of any organizational and legal form and form of ownership. In accordance with Paragraph 1 of Article 10 of the Law of the Republic of Kazakhstan dated February 28, 2007, “On Accounting and Financial Reporting,” the management or individual entrepreneur determines the persons authorized to sign accounting documents. At the same time, a hierarchy of signing authority may be established depending on the position held by the person, the amounts of money involved, the scope of application, and the nature of the transaction. A person obliged to prepare and submit documents concerning the payment of taxes to the tax authorities may bear liability as an accomplice to this crime.
A person who organized the commission of a crime provided for in Article 245 of the Criminal Code of the Republic of Kazakhstan, or induced the head, chief accountant (accountant) of the taxpayer organization or other employees of that organization to commit it, as well as a person who facilitated the commission of the crime through advice, instructions, etc., shall be held liable, depending on the nature of their actions, as an organizer, instigator, or accomplice under the relevant part of Article 28 of the Criminal Code of the Republic of Kazakhstan and the relevant part of Article 245 of the Criminal Code of the Republic of Kazakhstan.
If a person exercises legal or de facto management over several organizations and evades payment of taxes and (or) other mandatory payments in each of them, then, where appropriate grounds exist, their actions should be classified as an aggregate of several crimes provided for in the relevant parts of Article 245 of the Criminal Code of the Republic of Kazakhstan.
The actions of officials of state bodies and local self-government bodies who intentionally facilitate the commission of crimes provided for in Articles 244 and 245 of the Criminal Code of the Republic of Kazakhstan shall be classified as complicity in the commission of the said crimes. If, at the same time, they acted for the purpose of obtaining benefits and advantages for themselves or other persons or organizations, or causing harm to other persons or organizations, their actions shall also be classified under the relevant Articles 361 and 369 of the Criminal Code of the Republic of Kazakhstan.
Part 2 of Article 245 of the Criminal Code of the Republic of Kazakhstan provides for liability for qualified forms of evasion of payment of taxes and (or) other mandatory payments to the budget by organizations committed through the use of invoices without actual performance of work, provision of services, or shipment of goods.
An invoice contains information about the amount of money and an invoice section (accounting information). This document is extremely important, as it serves as the basis for accepting the amounts of VAT (value added tax) claimed for deduction. All organizations and enterprises that are VAT payers are obliged to issue invoices. In the commission of the crime under consideration, an invoice is issued without actual performance of work, provision of services, or shipment of goods.
Consequently, an invoice is a payment document containing the details of a value added tax payer, which is issued by that payer on the basis of a completed turnover from the sale of goods, works, or services, except for cases provided for by tax legislation. At the same time, an invoice may constitute one of the items of evidence of the conclusion of a transaction, but it is not the transaction itself.
Issues relating to the general provisions on invoices, the deadlines for their issuance, the specific features of their issuance by persons who are not value added tax payers and in certain cases, as well as the procedure for making amendments and additions to invoices and issuing additional invoices, are regulated by Chapter 47 (Articles 412-420) of the Tax Code of the Republic of Kazakhstan.
In this regard, in order to classify a person's actions under the element of using an invoice without actual performance of work, provision of services, or shipment of goods, it is necessary that the person, while evading payment of taxes and (or) other mandatory payments to the budget by organizations, uses invoices that not only formally fail to comply with the requirements of Chapter 47 of the Tax Code, but are also, in terms of their content, formally issued for work, services, or goods that were not actually performed, provided, or shipped.
In cases of evasion of payment of taxes and (or) other mandatory payments to the budget through the use of invoices without actual performance of work, provision of services, or shipment of goods, it is necessary to establish whether there was complicity between the person evading payment of taxes and the person who provided fictitious invoices in the commission of criminal offenses provided for in Articles 216 and 244 or Article 245 of the Criminal Code of the Republic of Kazakhstan.
Evasion of payment of taxes and (or) other mandatory payments to the budget by organizations shall be deemed to have been committed by a group of persons acting by prior conspiracy if persons who had agreed in advance to jointly commit the criminal offense participated in it.
Part 3 of the Article under consideration establishes liability for acts provided for in Parts 1 or 2 of the Article under consideration, committed by a criminal group or on an especially large scale.
The concept of a criminal group is provided in Paragraph 24) of Article 3 of the Criminal Code of the Republic of Kazakhstan (see the commentary to Paragraph 24) of Article 3 and Part 3 of Article 31 of the Criminal Code).
According to Paragraph 3) of Article 3 of the Criminal Code of the Republic of Kazakhstan, an especially large amount is an amount of payments not received by the budget that exceeds seventy-five thousand monthly calculation indices.
The Note to the Article under consideration states that a person who has committed an act provided for in this Article (with the exception of an act committed by a criminal group) shall be released from criminal liability in the event of voluntary payment of tax arrears and (or) other mandatory payments to the budget, as well as penalties established by the legislation of the Republic of Kazakhstan.
At the same time, pursuant to Paragraph 31 of the above-mentioned Regulatory Resolution of the Supreme Court of the Republic of Kazakhstan, release of a person from criminal liability on the basis of the Notes to Articles 244 and 245 of the Criminal Code of the Republic of Kazakhstan (with the exception of an act committed by a criminal group under Part 3 of Article 245 of the Criminal Code) may take place only upon full compensation of the damage through payment of tax arrears and (or) other mandatory payments to the budget, as well as penalties established by the legislation of the Republic of Kazakhstan. Partial compensation of the damage or an undertaking by the guilty person to compensate for the damage in the future shall not constitute grounds for release from criminal liability.
The acts provided for in Parts 1 and 2 of Article 245 of the Criminal Code of the Republic of Kazakhstan are classified as medium-gravity crimes.
The act provided for in Part 3 of Article 245 of the Criminal Code of the Republic of Kazakhstan is classified as a serious crime.
Commentary of 2021 on the Criminal Code of the Republic of Kazakhstan by Isidor Shamilovich Borchashvili, Honored Figure of Kazakhstan, Doctor of Law, Professor, Academician of the National Academy of Natural Sciences of Kazakhstan, member of the Scientific Advisory Councils under the Constitutional Council of the Republic of Kazakhstan and the Supreme Court of the Republic of Kazakhstan, member of the working group on reform of the law enforcement system under the Security Council of the Republic of Kazakhstan, Honored Employee of the Ministry of Internal Affairs of the Republic of Kazakhstan.
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