Legal Alliance secures a victory in a dispute with the tax authority

The tax authority charged the international company with significant monetary penalties along with fines. According to tax officials, the international pharmaceutical company unjustifiably included in the tax accounting the marketing and other promotional services received from its counterparties.

The tax authority justified its position by the fact that the Client's receipt of such services is, in their opinion, unrelated to the economic activity.

Disputes with the tax office regarding the practical and economic feasibility of business operations, with services as a subject, are in the category where tax officials feel confident.

However, our attorneys proved that the supervisory body was guided in its conclusions only by its own assumptions and incorrectly evaluated the available documents, as well as did not take into account the specifics of the Client's economic activity. Also, the tax body misinterpreted the essence of the transactions themselves.

Partner Vitalii Savchuk and senior associate Yaroslav Furiaka worked on the case.

"To be successful in such cases, one needs to understand not only tax legislation, but also to know inside out the specifics of the pharmaceutical market, as well as the business model of a particular client. It is worth being able to explain all this in simple words – for judges who are not obliged to understand every industry", Vitalii comments.