MOSCOW, November 15 (RAPSI) – Russia’s Investigative Committee has proposed a legislative ban on business that serves no other purpose other than obtaining tax exemptions in offshore jurisdictions, and the imposition of criminal liability on such business, senior inspector Giorgy Smirnov said during a press conference at RIA Novosti.

Smirnov said that the current Russian legislation does not directly prohibit such tax evasion schemes. This leaves open the possibility of establishing entities that serve no purpose other than enabling tax evasion.

The problem of offshore zones was raised by Russian President Vladimir Putin in June, when he announced on the heels of the G8 summit that Russia would tackle the problem by drawing up a national plan to deal with such tax havens.

“Legal entity X is registered in Cyprus, and then it turns out that what is registered in Cyprus is a subsidiary of what is registered on the Cayman Islands… It’s like a Russian matryoshka doll,” he said. "It is unclear what is at the end of it."

Addressing the offshore problem, Putin said that first of all, it is necessary to disclose the end beneficiary. Second, there should be unified rules of offshore zones’ operation. And third, he said, no vague tax-evading tools should be used.