Wednesday, January 14, 2009

NGOs in Russia Waiting For Government to Determine Which Ones Are Allowed Tax-Free Grants

The Moscow Times reports that all money in Russia that went to NGOs is frozen due to the economic crisis and although some NGOs operating in Russia are intensifying fundraising efforts with Western donors, they fear that financing from abroad will also dry up.

Amid fears that Western money might be funneled to Russian NGOs to incite unrest, the government enacted a stringent law in 2006 that led to the closure of many NGOs and greatly increased the bureaucratic burden on those that remained. And now, the scarcity of funding combined with continued uncertainty about the authorities' actions is shaping into a perfect storm for NGOs. A top concern for many activists in recent weeks has been the government's failure to publish a vital list of which organizations can issue grants without having to pay taxes on them. Many donor organizations make tax-exemption an essential requirement for releasing the money.

In June 2008, Prime Minister Vladimir Putin signed a decree that listed just 12 organizations that were allowed tax-free grants, down from 101. The government said at the time that the list only contained intergovernmental organizations and that a list including all the other organizations would be issued by the end of the year. It remained unclear Monday when Putin would sign the second decree.

Other NGOs believe that Russian authorities feel threatened by possible public unrest linked to the economic crisis and therefore the government is tightening the screws. For example, Greenpeace Russia was forced to change its status from a national organization to an office of Greenpeace International. According to Greenpeace Russia's director, Sergei Tsyplyonkov, authorities told the organization that its status change was necessary because the legal statutes of Greenpeace Russia, founded in 1992, were out of date. "We received letters from the Federal Registration Service and the Justice Ministry that effectively gave us a deadline to reregister as a division of our international organization. Otherwise, we could have been dissolved," Tsyplyonkov said. He claims this was an effective way to increase state control over NGOs because the law sets more stringent restrictions on subsidiaries of foreign NGOs than on national NGOs.

Tsyplyonkov said he was also worried about changes to the Criminal Code announced late last year that would widen the definition of treason and spying. "Now speaking to members of foreign organizations could be an act of treason," he said.

Greenpeace is also finding it increasingly difficult to conduct fundraising in Russia because red tape at banks makes it cumbersome for people to give money to an organization. According to Tsyplyonkov, "Direct debit is impossible and standing orders are tedious, forcing donors to stand in line at Sberbank."

SS

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