SERGEI PRIKHODKO: people will pay

Sergei Prikhodko, Executive Director of the Gaidar Institute for Economic Policy made a comment for the Kommersant FM on the proposal by Andrei Kostin, Head of the VTB Bank to abolish the income tax for low-income people.
During the Moscow Financial Forum, Andrei Kostin proposed to relieve low-income people and the small business from paying the income tax and social security contributions, respectively.
"But it is interesting who will pay the bill in such a case? The income tax is the main source of replenishment of regional and local budgets. Will bankers and other initiators really compensate the shortfall in income to the budget?” the Kommersant FM reports.
According to Sergei Prikhodko, one should not hope for it: people will pay one way or another and more likely through the increase in taxes. There is a budget. If tax privileges are granted, the revenues will decrease. They will have to increase something, either taxes or duties. The other option is to reduce spendings.  We know from this country’s experience that they will cut expenditures on education, healthcare and other”, Sergei Prikhodko says.