The president’s message to the Federal Assembly of 2005 mentions, among other things, the amnesty of capital. The bill on it was subsequently quite actively discussed in the State Duma. It should be said that such a practice has already taken place in the country three times. However, all these times were extremely unsuccessful. 
Amnesty of capital: what does it mean?
This procedure involves commuting or forgiving previously committed tax crimes. Around the world, one of the most serious deeds is the evasion of the obligation to pay fees to the state budget. Amnesty of capital has its own specifics. It differs significantly from the procedure for mitigating sanctions or forgiving crimes against property or the individual. During the development of measures to reduce or exempt from liability, economic aspects should be taken into account first of all. The purpose of the amnesty of capital is to expand the tax sphere and attract public funds in the development of the national economy.
The essence of the institute
What is amnesty capital in Russia? For a clearer understanding of the essence of this procedure, refer to the message of the president. In it, from the very beginning, rather stringent conditions were formulated. First of all, an amnesty of capital involved the deposit of funds exclusively in domestic banks. In addition, 13% tax was to be paid from legalized finances without further burden.
Urgency of the problem
According to experts, when the law on capital amnesty was being discussed, about 100 billion dollars were in the hands of the population in Russia. At the same time, about 300 billion dollars went abroad. The large amount of funds settled abroad, but formally owned by Russians, creates certain difficulties the process of attracting foreign investment in the domestic economy. As world experience shows, states that are interested in an influx of funds from abroad, primarily seek to create preferential conditions for the subsequent return of the finances of their citizens. By doing this, governments are improving the investment climate in their countries. As for Russia, the problem here is more acute. This is due to the fact that in 2005 there was a noticeable decrease in the activity of investors in the economy, despite even a decrease in UST and VAT. According to Rosstat, investment in fixed assets increased by 11.7% by 2004, and by 10.7% by 2005. 
Negative foreign experience
Periodically, a law on capital amnesty is adopted in a particular country. It is worth saying that foreign countries have both positive and negative experience in its implementation. An example is Belgium. In 2004, the law on the amnesty of the capital of individuals was approved in this country. She suggested that citizens with savings in foreign banks would be able to transfer them to their country before the end of the year without any sanctions. In response to this, the Belgians were supposed to give from 6 to 9% of the returned amounts to the treasury.
The Ministry of Finance of the state expected that citizens will return 10-15 billion euros, of which about 850 million will be deducted to the budget in the form of fees. This amnesty of individual capital in Belgium has been timed to coincide with the introduction of the European Directive since the beginning of 2005. In accordance with it, all EU banks were required to provide information on the contributions of non-residents to the control financial services of the states whose citizens they are.The directive extended, in particular, to Luxembourg, which contained the basic assets of the Belgians. From Liechtenstein and Switzerland, the European Commission was able to achieve the establishment of high fees from contributions of non-residents of the EU countries. This, accordingly, made it extremely unprofitable to keep finances on the accounts of banks of these states.
Summary
Amnesty of capital in Belgium allowed to receive a little more than 50 million euros (about 6% of the estimated amount). In general, about 1 billion euros returned to the state economy. Such minor results are due to the following reasons:
- In the presence of an agreement between the banks and the Luxembourg government with the Belgian authorities on the possibility of subsequently continuing to store Belgian funds in foreign accounts.
- Hope for subsequent amnesties, during which it will be possible to declare undeclared funds again.
- Inefficiency and limited stock investments in securities of Belgian enterprises.
Good practice in Italy
In this country, an amnesty of capital took place in 2001-2002. Unlike the Belgian scheme, in Italy taxes unpaid on time were forgiven. Thus, at the same time, two exemption models operated in the country. According to the Decree on legalization, approved on September 25, 2001, the payer was to deduct 2.5% of the value of the property, according to which a declaration is drawn up. An amnesty of capital allowed the purchase of Italian securities instead of the specified payment. It should have been carried out in an amount corresponding to 12% of the hidden property. In response, the tax office issued special certificates of confidential contribution. The following provisions were present in them:
- Exemption of the entity from submitting a declaration, paying off tax arrears, audit of finances received before legalization.
- Absolute confidentiality of all movements of funds for social security agencies, control and other interested services.
- Exclusion of accounts of debts on fees, penalties, fines imputed in respect of assets submitted for declaration.
- Taxation of legalized income through a repatriating institution in confidentiality.
Additional measures
Along with exemptions, liability for tax violations was tightened. In particular, before the amnesty, the penalty for concealing income was 250-2000 euros, regardless of the amount, after it was introduced, the recovery began to amount to 5-25% of the amount of illegal profit. In addition, a proportional amount of property was seized from the offender.
results
As a result, an amnesty in Italy made it possible within the first two months to return to legal circulation assets worth € 61 billion. Fees increased by 24 billion, and a one-time tax on declared income additionally brought to the treasury 1.4 billion. These measures allowed the Berlusconi government to remove the burden of income tax on income of less than 25 thousand euros per year, as well as reduce the number of mandatory contributions for entrepreneurs .
National history
In October 1993, a decree was issued according to which the amnesty of capital was introduced for the first time in the country. Six months did not pass, as it became clear that this idea failed. Under the decree, entities that concealed income were asked to simply pay all taxes. In case of non-payment by the end of November of the same year, the control service was to begin collecting fines in triple amounts. The extension of the capital amnesty, of course, was not envisaged. The main reason for the failure of this scheme was the desire of the authorities to receive immediately and all without any adequate retaliatory measures.
The following amnesty was proposed in 1995. The idea was submitted by the Ministry of Education.In accordance with it, the funds invested in the development and subsequent implementation of innovative technologies should have been exempted from declaring for several years. The document was sent to the Ministry of Economy, but was not implemented in practice.
Third attempt
In the fall of 1997, President Yeltsin once again proposed an amnesty of capital. It was assumed that citizens legalizing income should have paid 10% of them. The bill provided for an exemption from liability for financial transactions with funds or other property acquired in a knowingly unlawful way. In addition, no punishment was applied to the entities for failure to submit a profit declaration or inclusion of deliberately distorted information in the statements. But this idea was not realized. 
Success factors
Analyzing foreign experience, experts determine several conditions under which an amnesty can become effective. First of all, it is necessary to clearly define its goals. According to the tasks set, a system mechanism is being developed. If the goal is to reduce the budget deficit due to additional revenues from taxes and fees and subsequent long-term investments in the economy, it is necessary to offer the entities a profitable model of legalization of income, while simultaneously declaring tougher sanctions for further violations.
If the main objective is to attract investments with a concurrent increase in the tax base, then a low-cost and effective mechanism for removing assets from the shadows should be provided to citizens. At the same time, emphasis should be placed on the transfer of property and funds to legal circulation within the state. In both cases, however, clear guarantees of confidentiality and exemption from liability will be mandatory. An important element is the mass media company in the media. 
Key conditions
Based on the president’s message, it can be determined that the main goal of the 2006 amnesty was to attract long-term investment capital in the country's economy. At that time, there were no signs of a budget deficit, since world oil prices were at a fairly high level. In this regard, experts identify the following conditions under which the effect of financial amnesty can become tangible:
- Payment for legalization of assets should be reduced as much as possible. In this case, Kazakhstan (0%), Italian (2.5%) or Belgian (6%) models can be taken into account.
- The regulatory act regulating the procedure should not only indicate the need to deposit funds in domestic banks, but also list them specifically. The list could include only those financial institutions in which regional or federal executive structures participate. For example, it is Bank of Moscow, Vneshtorgbank, Sberbank.
- The law should provide for state guarantees for the safety of finances returned to their homeland. They could be provided with bonds for the same amounts or in other ways.
- The law should provide a mechanism by which entities will be exempted from filing declarations with deliberately distorted information, conducting transactions with property or money obtained illegally (through non-payment of mandatory contributions), and other violations.
- In order to ensure the confidence of payers in the honesty of state structures, one can turn to the experience of Kazakhstan with the exponential liquidation of all reports for previous periods.
- In the law governing the simplified procedure for declaring citizens' profits, it is necessary to include a list of specific measures aimed at tightening the liability of entities for tax crimes. Their introduction is advisable immediately after the period of preferential income legalization.
Conclusion
As an indispensable element of all successful amnesties was a powerful media accompaniment. PR companies should cause patriotic feelings in the population. So, for example, in Poland, a financial amnesty was accompanied by the slogan "Save Poland!" In Italy, a set of measures for preferential legalization of profit was called the “Tax Shield”. As world practice shows, amnesty of domestic capital is more successful. It is more effective than any attempts to repatriate the funds of the population accumulated in the accounts of foreign banks. Nevertheless, in any case, the success of preferential legalization of capital will largely depend on measures taken in the framework of the development of the national economy. The state should play a special role in this. The government is obliged to provide a clear regulatory framework and guarantees to entities returning their assets.
