United Russia member Andrei Makarov, Chairman of the State Duma Committee on Budgeting and Taxation, proposed introducing fines for self-employed citizens who do not pay taxes on their income in the amount of that income, RIA Novosti reports.
Self-employed citizens include those who are not officially employed such as freelancers, private hairdressers, representatives of microbusinesses, etc.
“We propose that, if a person is not registered as self-employed and is found to have untaxed income, the violator will pay a fine in the amount of that income,” Makarov said. “So, they have a choice, to pay 4% or to hand over their entire income.”
Andrei Makarov stressed that the measure may affect 30 million citizens with shady earnings.
Obviously, the initiative aims have as many self-employed people as possible registered with tax authorities, according to Nikolai Yepikhin, tax expert and director of the Uproshchyonka (“simplified tax system”) website, who spoke to Invest Foresight.
First they will register and start paying the reduced tax of 4%, which is, of course, better than 13%, the personal income tax paid by employed workers.
“However, the rate will begin to increase until it gets closer to 10% to 13%. The government expects that the taxpayers will not notice and eventually get used to it,” the expert noted.