The State Control Committee has presented major tax claims against businesses involved in the import and sale of tulips. Criminal cases have been opened. Business owners are suspected of tax evasion, selling products at understated prices and tax fraud.
According to the State Control Committee, a peasant farm in the Brest region was engaged in agricultural production and also cultivated and sold tulip bulbs. The farmers applied the single tax for agricultural producers, which amounts to 1% of gross revenue. A condition for using this regime is that revenue from the sale of agricultural products must account for at least 50%.
“However, by 2022 revenue from the sale of tulips already exceeded revenue received from the sale of agricultural products. In this regard, the head of the farm together with his deputy (and at the same time the owner of the business) registered a controlled company to which part of the revenue from tulip sales was artificially redistributed. The formal head of the newly created firm was appointed a driver of the farm,” the committee said.
The State Control Committee considers this a violation. According to investigators, because of the redistribution of revenue and the understatement of the tax base, the farm failed to pay more than 1.3 million rubles in taxes between 2022 and 2025.
The committee also reported uncovering cases of concealed revenue.
“Products were sold for cash, while the farm’s accounting records contained amounts understated by more than 20 times. Examination of seized draft records showed that more than 10 million rubles had been concealed from taxation over the past two years alone,” the State Control Committee added.
In addition, investigators found that the business owners submitted fictitious documents to claim VAT refunds totaling more than 950,000 rubles.
“To obtain VAT refunds from the state budget (more than 950,000 rubles), the business owners submitted fictitious documents to the tax authorities claiming that the controlled company had purchased tulips from the farm at understated prices and subsequently sold them to buyers in the Russian Federation (the controlled company in fact did not participate in these transactions). They also understated the quantity and value of tulip bulbs sold by the farm to private individuals. Timely intervention by the Financial Investigations Department prevented them from fully carrying out the scheme,” the committee said.
The suspects in the criminal cases include the business owner, the head of the farm and the director of the controlled company.
Authorities have seized four apartments and ten cars belonging to the suspects, and also confiscated 440,000 euros and 89,000 dollars.
The suspects are reported to have given confessions.
