Belarusian population will pay for raised taxes
As of April 1st, 2016, VAT on telecommunication services were raised from 20% to 25% and VAT on passenger transport services were introduced. The government has calculated that this measure would raise additional BYR 1.4 trillion for the state budget. Meanwhile, mobile operators have announced changes in tariffs for final consumers. The state is likely to come up with other similar initiatives in order to squeeze more cash from the population. In addition, the tax burden on private business is likely to increase too along with tighter liability for tax evasion and enhanced control over business activity. Increased excise tax on fuel and introduced VAT on passenger transport are likely to significantly undermine financial health of the refinery and transport organizations, and lead to the lift of the ban on growth in fuel prices and on services.
The Labour and the Tax Ministries are considering the possibility to include persons engaged in some economic activity without forming a legal entity in the social security system. When the decree No 337 comes into effect, the number of private entrepreneurs is likely to reduce due to the possibility of reducing the tax burden when switching to a tax payment as an individual. 95% of self-employed, including PE, pay insurance premiums on the basis of the minimum wage. The number of self-employed citizens is expected to increase, the number of insurance contributions to the pension system from PE will decrease, the number of citizens who will pay a fee to finance government spending will decrease by several tens. Self-employed citizens have the alternative not to pay social security fees and save resources for future pensions, which, given the gradual restriction by the state of pension requirements could be a more long-sighted option.