Personal incomes to be collected at places of residence in Karachai-Circassia.

Personal incomes to be collected at places of residence in Karachai-Circassia.

Prime Minister Vladimir Putin suggested that collection of personal income tax at home rather than at work may be tested in Karachai-Circassia. The republic's head Rashid Temrezov supported this idea.

During a working meeting with Temrezov Putin raised the issue that was discussed at a recent conference on housing construction development. Its participants were the first to propose this idea.

Putin said that currently personal income tax is collected at the place of employment as it's easier for the tax agencies to work with businesses. But the local governments are not motivated to build new housing because it leads to the population growth, thus increasing budget demands and the burden on the infrastructure, whereas the area's revenues remain low.

"Those who question this measure said it would work but would not be expedient in every region. Tell me now: would it work in your region or not really?" Putin asked Temrezov. Temrezov supported this idea. He thinks it will be more efficient to collect personal income taxes at the place of residence because in many municipal districts people are leaving for bigger cities and the municipal authorities have a tax shortfall.

Putin recalled another idea voiced at the same conference: probably local governments could influence companies to hire only local residents. "Can the heads of municipal districts influence company CEOs in this way?" Temrezov generally agreed with the idea but suggested studying it in more detail.

One more issue was about salaries of public-sector employees. Putin asked Temrezov about the republic's performance in the first quarter of the year and the implementation of social projects. Temrezov described as positive the results of work in the past year and the first quarter of this year. "Regarding doctors' salaries, they have grown above the republic's average, which itself increased 10% in 2011, and are currently about 15,300 roubles. The teachers' salaries are a little below the national average," Temrezov said and promised that in the fourth quarter, teachers' salaries should reach the average for the economy reported in the first quarter.

Putin objected to this strategic planning: "Well, this is not how it should be. The salaries must be raised to the average for the fourth quarter," he said. "This year we will reach the average for the economy," Temrezov suggested as an alternative. But the prime minister was adamant: "No, let's try to do our best, as otherwise it will be a game of figures. We must not cheat people, do you agree? The increase will not be large, I'm sure, but it would make a big difference to the budget. Let's think about ways to do this, to ensure that a teachers' salary is raised to the average for the economy in the fourth quarter, all right?" "Absolutely, Mr Putin," Temrezov promised.

Semyon Toporkov