Point of law: whether tax agent must pay at his own expense the amount of VAT, which he failed to withhold from a foreign taxpayer, given that the tax agent has already paid fine and penalties for this violation of tax legislation?

Alternative attitudes: 1) the law does not permit to recover from the tax agent the amount of tax which he failed to withhold, the only consequences being a fine and penalties for the failure to fulfill the duties of tax agent; or 2) it is the tax agent who must pay the amount of tax which he failed to withhold.

Ratio decidendi: the Presidium deemed the second solution to be legally correct, based on the following: а) the amount of tax was not included into the remuneration paid to the foreign company, and thus remained at the disposal of tax agent, b) the taxpayer preserves the right to deduct this amount from his output VAT, and c) the taxpayer does not remain to be the person obliged to pay VAT because he is not registered with tax authorities of the Russian Federation.

Practical consequences: the Judgment does not provide for the possibility to reverse inconsistent court decisions in prior analogous cases by virtue of Art 311 of the Commercial Procedure Code. Therefore, its ratio decidendi has only prospective force.