Taxes kill Russian’s purchasing power – expert

Credit: Maxim Blinov | RIAN

Collecting transport tax is unnecessary in many regions; however, it accounts for a significant share of local budgets in some areas, according to Dmitry Zavorotny, Director of the Economic Strategy Center at the New Society Institute, who spoke at a National News Service news conference on September 9.

Before abolishing transport tax, we should analyze the situation in different regions. For example, Moscow’s budget will not even notice the lack of transport tax and it can be easily repealed,” the expert stressed.

He added that some categories of the public should be exempt from paying transport tax.

“For example, individuals with low income can be spared this tax, unlike legal entities.”

Dmitry Zavorotny pointed out that the statutory payment burden for Russians has substantially increased in the past years.

“Value-added tax is higher; there are now major renovation duties. Tax hikes eat away at people’s purchasing power, which negatively affects the economic growth. As a result, more Russians are taking out loans and their aggregated loan debt is already RUR 16 trln ($244.5 bln). These indicators are out of control. Therefore, we need to think about decreasing the tax burden, to stimulate the economic development,” the expert concluded.

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