SERGEI PRIKHODKO: “PROGRESSIVE SCALE IS UNLIKELY TO REMOVE SOCIAL STRAIN”

The Kommersant FM Radio published the opinion of Sergei Prikhodko, Candidate of Economic Sciences, Executive Director of the Gaidar Institute on the introduction of progressive tax.

Mikhail Shapov, State Duma deputy has come out with a proposal to increase the income tax for wealthy Russians and reduce it for low-income individuals. In Mikhail Shapov’s view, this initiative will help reduce the gap in incomes of the population. Mikhail Shapov stands for charging personal income tax of 25% on an individual’s annual income of over Rb10mn. According to Mikhail Shapov, excessive profits should also be taken away from this category of citizens. Also, Mikail Shapov’s initiative suggests reduction in the tax rate for individuals who receive the minimum monthly wage or even less; the tax rate for such people is proposed to be reduced to 5% or zero. Mikhail Shapov believes this measure will reduce the gap in incomes and social strain.

In Sergei Prikhodko’s view, this measure is unlikely to solve this problem.

“Doubtlessly, these are not incomes of our oligarchs whether in the oil industry, metallurgy or anywhere else. With no growth in investments and business attractiveness, tax avoidance may play quite the opposite role. Some entrepreneurs will do their best to prevent it. In terms of populism, it is, certainly, a good idea. However, if we try to take away from the rich a large portion of their incomes, it does not necessarily mean that the poor will get more money.”