Kirill Chernovol, a Researcher of the International Best Practices Analysis Department at the Gaidar Institute, commented for Izvestia on the consequences of a possible increase in the income limit for the self-employed to Rb3 mn per year and the extension of the experiment on professional income tax until 2035.
According to the expert, increasing the limit is unlikely to result in the emergence of fundamentally new professions in the self-employment segment.
"The initiative is likely related to the need to account for inflation and rising costs of goods and services. In the coming years, the most significant expansion of self-employment is expected in established sectors: home and appliance repair, furniture assembly, delivery, tutoring, marketing, design, and short-term rentals," said Kirill Chernovol.
He noted that for small businesses and microenterprises, extending the self-employment mode creates additional opportunities to launch new projects and quickly recruit specialists for specific tasks. This format allows companies to more quickly respond to seasonal fluctuations in demand and meet short-term staffing needs without expanding their permanent staff.
At the same time, the expert focused on the existing risks of substituting employment relationships. If a self-employed individual effectively works as a full-time employee, performing tasks for only one client and under their supervision, tax and labor authorities may classify such a relationship as an employment relationship. In this case, business faces additional taxes and penalties.
"Raising the income limit to Rb3 mn does not mean a fundamental change to the self-employment model. Rather, it is a matter of adjusting the mode's parameters based on the economic dynamics of recent years. The most likely areas for further development are those in which the self-employed have already captured a significant market share. For businesses, this is an additional tool for flexibility, allowing them to more quickly meet temporary needs for specialists. However, it is important to maintain a balance between employment flexibility and compliance with labor laws, as the excessive use of self-employed workers to perform the functions of full-time employees creates risks for both companies and contractors," emphasized Kirill Chernovol.
The expert also noted that the impact of expanding the mode on the budget will depend on the sources of the increase in the number of self-employed. If people previously employed informally continue to enter the system, tax revenues will increase, and the state will gain a more complete picture of the population's employment. However, if the increase occurs due to employees transitioning from employment to self-employed status, this could result in a reduction in personal income tax and social security contributions, which is already receiving special attention from regulatory authorities.