"Gazeta": "Antidote to insurance premiums"
Business is looking to compensate for the damage from increased burden on the wage fund.
Opening the annual Russian Pension Forum, Vladimir Putin reaffirmed the government's commitment to implementing pension reform. The prime minister admitted that the tax burden remains the main problem for business in the course of pension reform. "We must move towards easing the fiscal load, but do it carefully," Putin said.
Healthcare and Social Development Minister Tatyana Golikova later said that the government would revisit the issue of refunds in spring, although "meetings and discussions continue" even now.
The Finance Ministry confirmed to our correspondent that no detailed discussions of tax refunds to business would take place before the spring of 2010. "The tax burden on business will not increase until the beginning of 2011. The next year is a transitional period during which many companies will not be affected by adverse changes," a source at the Finance Ministry said. The insurance contribution rates will be raised from 26% today to 34% beginning from 2011. For some companies - agricultural producers, residents of special technical innovation economic zones, organisations that employ disabled people and enterprises that enjoy special tax regimes - the rates on contributions will gradually increase to 34% by 2015.
For companies not eligible for the preferential transitional period, the tax burden will increase by 800-850 billion roubles in 2011, the Finance Ministry estimates. This year, however, business will be able to save a similar amount, according to the Ministry. A saving of 700 billion roubles will result from a profit tax cut from 24% to 20%, an increase of the depreciation bonus from 10% today to 30%, and an option for regions to cut the rate under the simplified taxation system.
Tax cuts are not the only way to develop the economy, Putin said yesterday. "What about modernisation, cost cuts and innovation? All these things should be done. Relieving the tax burden is a correct measure, but one cannot cut it endlessly."
Representatives of the business community support modernisation and innovation, but note that the best way to encourage these processes is through tax incentives.
"Transition to insurance payments does not necessarily need to increase the tax burden; the tax system must be more stimulating than it is at present. It should not hold back, but spur investment, innovation and modernisation," said Alexander Shokhin, the head of the Russian Union of Industrialists and Entrepreneurs (RUIE), addressing the November meeting of the Union's Board devoted to the replacement of the Single Social Tax with insurance contributions.
The Union has already submitted proposals to the Economic Development Ministry to bring back the investment preferences (reducing profit tax by the sum that went into capital investment) and expand the list of depreciable equipment groups for which the depreciation bonus of up to 30% is allowed, says Deputy Chairman of the RUIE Budget and Tax Policy Committee, Andrei Tikhonovsky.
Kseniya Batanova
