Vimpel Is No VIP in Russia

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"Be thankful I don't take it all. 'Cause I'm the taxman. Yeah, I'm the taxman."
-- The Beatles

Its stock symbol is VIP, but Russian telecommunications company VimpelCommunications (NYSE: VIP) is hardly getting the VIP treatment from the Russian tax authorities. The company announced that the taxing agency has reviewed its 2001 tax filing and wants an additional $157 million. Ouch!

Vimpel, second in size only to Russian wireless giant Mobile TeleSystems (NYSE: MBT), can pay the tax bill. It has $189 million in cash and produced $337 million in net income over the last 12 months.

What sent the stock down more than 20% today was at least two factors. One is the memory of oil company Yukos, whose tax bill ballooned so huge its core assets are being sold to pay the bill.

Russia's tax agency is building a reputation as a spoiler. BP (NYSE: BP) owns the third-largest oil company in Russia, and it recently received a tax bill of $87.4 million for, you guessed it, 2001 taxes. Who'll be next?

There is always a risk in investing in foreign countries. It is hard to follow foreign politics (hey, it's hard to understand local politics!), and there are currency fluctuations, corruption, and, in Russia's case, the taxman. Vimpel and BP are challenging their tax bills. How successful they will be is not known.

The tax agency's changing focus from oil to other industries threatens to cast a pall over all Russian businesses. There may be a buying opportunity in this, but who wants to bet against Russian tax collectors?

Fool contributor W.D. Crotty does not own stock in any of the companies mentioned. The Motley Fool is investors talking to investors. Discuss Vimpel and BP -- and thousands of other stocks -- on The Motley Fool discussion boards.