The Russian government on Thursday doubled the back taxes it is demanding from Yukos Oil Co. to nearly $7 billion, a dramatic escalation in a politically charged legal campaign against the huge firm and its owners.
The government decided to bill Yukos for $3.4 billion in back taxes for the year 2001 on top of a nearly identical claim for 2000, which was upheld by a Moscow appeals court this week. Officials leaked news of the new claim to a Russian news agency on the same day that court bailiffs froze Yukos bank accounts and arrived at company headquarters with a writ demanding payment of the first bill in five days.
Yukos maintains it cannot immediately pay even the original charges and is seeking a settlement to reduce the financial burden. The federal tax service is pressing the additional claims despite a recent assertion by President Vladimir Putin that he did not want to see the company enter bankruptcy.
Yukos's already depressed stock plunged another 12 percent on one key exchange Thursday.
Yukos executives and financial analysts had long predicted additional tax bills. But some analysts said the timing could be an attempt to bolster the government's bargaining position if it eventually agrees to negotiate a deal. Yukos lawyers on Tuesday presented a plan in court proposing it pay just $1 billion of the original bill. The government appears to be responding by demanding another $3.4 billion instead.
Some analysts discounted the assumption that the government wanted a settlement, at least anytime soon. "If I had a dollar for every time I've heard there's going to be a deal between [Yukos's owners] and the Kremlin, I'd have $3.4 billion," said James Fenkner, research director at Troika Dialog, a Moscow brokerage.
The company complained Thursday that freezing its bank accounts could disrupt operations at Russia's second-largest oil producer. "The actions . . . create an indisputable threat of halting current operations of Yukos Oil Company that are of strategic importance for Russia's fuel and energy industry, a threat to the company's ability to pay current taxes and meet its obligations to creditors," it said in a statement.
News of the new claim came a day before the one-year anniversary of the government's multifaceted legal campaign against Yukos and its owners. Billionaire Mikhail Khodorkovsky and another top shareholder, Platon Lebedev, are in prison awaiting trial on charges of fraud and tax evasion.
Many Russians see the trials and tax bills as part of a grudge match between Putin and Khodorkovsky over power and influence in Russia.
Court bailiffs, accompanied by armed guards, showed up at Yukos headquarters in Moscow on Thursday with the written documents instructing the company to pay the first $3.4 billion bill within five days.
Yukos lawyers met with the bailiffs and suggested they accept the company's remaining 35 percent share of another oil company, Sibneft, with a market value of $3.7 billion. But the government has already obtained a court order that prevents Yukos from selling assets, so the bailiffs refused to accept the Sibneft stock and left.
The government will now revise tax charges from 2002 and 2003, which could bring the cumulative bill to $10 billion, many financial analysts predicted. "We're going to have another charge," Fenkner said. "It's not over."