Leu Marholin: The authorities took the strategy of collecting dribs and drubs in economy

Tax remissions are cancelled; however, the Tax Ministry assures that the changes to the tax legislation in 2016 are unlikely to happen. Tax plan is going to be fulfilled.

Reforms won’t start in 2016. The authorities seem to take the strategy of drawing out as much as they can from their compatriots’ pockets, though after the introduction of taxes on debts, deposits, freeloaders, cars, and so on it’s hard to think of new ways to get money for the treasury.

But well, there are still opportunities for the abolition of the existing tax remissions as the so-called indexation of tax rates; there are ideas, which, though, are not approved by the Tax Ministry yet, to increase the tax rate for tradesmen, agroecotourism, and even casino winners. VAT for gas and electricity is thrown over to consumers and will be counted differently. There is danger that the calculation is not very clear, notes the economist Leu Marholin.

“If the VAT sum will be becoming bigger for consumers, it will have a negative impact on consumers regardless of the impact on the service providers. There are no specific details about the mechanism yet, so it’s hard to judge how exactly it’s going to work”, - noted Leu Marholin in the talk with the “EuroBelarus” Information Service.

The actions of the authorities in the economy in the past year prove that “Lukashenka has dropped the long-advertised creation of the socially-oriented economy as something absolutely ungrateful and unpromising; no one among the authorities is even mentioning a social state”.

“In my opinion, now the authorities took the strategy of collecting dribs and drubs in economy. I.e. taxes are introduced, but they won’t give much income to the treasury; there’ll be no profit, but only pennies and irritation of the people. Every ministry, every institution, and every state body just want to report that they’ve done everything possible for replenishing the national “money-box”, - Leu Marholin assumes.

As to the inevitability of reforms, as a number of economists think, “in my opinion, whether to risk or not to risk and introduce the reforms doesn’t depend on the state “money-box” at all”: “But it all depends on the reaction of the population. We remember the features of the revolutionary situation: the upper strata cannot rule as they used to, whereas the lower classes don’t want to live the way they lived. Whereas surprisingly, in our country we still see no signs that the lower classes don’t want to live the way they lived. For now everything’s silent, and the only stimulus to reforms for Lukashenka is the possible revolt of the workers, pensioners, budget workers, and students… If the risk of introducing the reforms becomes less than that of not introducing them, only then we can count on some changes”.

According to the economist, “our authorities learned to handle the problems of the budget with the help of the so-called inflation tax”: “They introduced a half-secret decree on increasing the internally held public debt by 4 trillion rubles. What does it mean? It means that the whole population of Belarus is levied additional taxes in order to collect this huge sum. How do they do that? The National Bank issues unsecured debt obligations by 4 trillion rubles, respectively, the money supply becomes larger, but the same amount of goods remains, and, therefore, the price of these products together also increases by the 4 trillion. That is what they call a Belarusian solution. They have been doing it for the last twenty years – and can keep doing it long enough. As long as people don’t say, "Enough."

In the meantime, people prefer leaving the country or staying in sleepy apathy. "Cuba is suffering, North Korea is suffering, why can’t we do the same? Though, it might be that it is the lack of complete isolation, such as in those countries, that extends the Belarusian situation? We're the leaders in obtaining Schengen visas. When every man answers the question of what to do: whether to protest in the streets or get a visa and leave Belarus in search of happiness, the most dashing, able-bodied, and vigorous chose emigration. But 2016 will, probably, show whether Belarusians can lose their patience at all,"- Lev Marholin believes.