RFE/RL TAX TRIAL BEGINS

UNCLAS DUSHANBE 000167

SIPDIS

DEPT FOR SCA/CEN

E.O. 12958: N/A
TAGS: OIIP KDEM PHUM KPAO TI
SUBJECT: RFE/RL TAX TRIAL BEGINS


1. (U) Summary: EmbOff attended the first hearing Feb. 11 in the
Radio Free Europe/Radio Liberty tax trial. Representatives of
the State Tax Committee and the station presented their main
arguments. The judge asked both sides to provide more
information and set a date for the next hearing. After the
session, the tax committee representative approached EmbOff and
asked for the Embassy's help in collecting payment from the
station. End summary.


2. (U) RFE/RL's legal problems stem from the alleged failure of
the station's contract employees to pay taxes, as discovered in
a 2008 tax inspection of the station. In the hearing, the
committee representatives said that the station's employees owe
1 million Tajik somoni (about $270,000) in taxes dating back to

1998. RFE/RL filed a complaint against the tax committee that
resulted in this court process, in which the station is the
plaintiff.


3. (U) The tax committee's attorney was not present, but two tax
inspectors argued their case before the judge. RFE/RL brought a
lawyer, who asked that the next hearing be delayed so the
station could "hire a professional lawyer."


4. (U) The tax committee representatives said they never
received the written complaint that sparked this hearing from
RFE/RL. The local RFE/RL manager said he delivered it to the tax
committee and a recipient signed for it. He presented the
signature to the judge.


5. (U) The tax committee representatives indicated that they
would call as a witness an RFE/RL journalist whom they ordered
to pay taxes. They also said that RFE/RL was acting
duplicitously by paying reporters as stringers but accrediting
them as employees. The station's lawyer responded that under
Tajik law, accreditation has nothing to do with full-time versus
contract employment, which is also Post's understanding.


6. (U) RFE/RL's lawyer said the station wrote to the tax
committee asking for guidance on how to pay taxes for stringers
and never heard back. The judge asked the station to provide
wording from the station's charter that might affect the case,
and requested a written refutation of the charges from the tax
committee. The next hearing is scheduled for Feb. 23.


7. (U) During the hearing, the tax committee representative
asked EmbOff to explain what would happen in the United States
"if someone didn't pay their taxes." The judge moved on, but the
representative approached EmbOff after the hearing and asked
again. EmbOff said it would be determined through a legal
process similar to this one. The representative then said "this
is not a political issue. They owe taxes. They need to pay. I'm
asking the Embassy to help get this resolved." EmbOff replied
that we are strictly observers and that a judge will determine
RFE/RL's responsibilities, if any.


8. (U) Comment: The wife of an LES staff member is an employee
at RFE/RL. She says that when the tax inspector came to the
station, he was insulted that the station didn't buy him lunch
or gas for his car, as is customary when dealing with tax
inspectors. This information doesn't explain the whole case, but
does some shed light on the way justice is perceived in
Tajikistan.


9. (U) Comment: It is unclear to EmbOffs why RFE/RL is being
held solely responsible for the failure of freelance employees
to pay their own taxes, while the employees themselves have not
been asked for the money. This may be due to the station's
perceived wealth and connection to the U.S. Government. The tax
committee representative may have been implying that the Embassy
should assume the station's tax responsibility. End comment.

JACOBSON