President finds way to pay off pension and salary debts

09/24/15 11:16

President finds way to pay off pension and salary debts

President Yevgeny Shevchuk has submitted to the Supreme Council a draft law "On Offshore Duty", which may ensure the payment of salary and pension debts
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In case of approval the law will increase budget revenues by hundreds of millions roubles and offset the existing deficit. This bill has already been submitted to the Supreme Council, but has been rejected.

The law provides for the introduction of a special duty — an offshore fee for the businessmen working in offshore zones. Following this scheme, big business evades paying taxes to the country's budget and fulfilling its social obligations. According to the Pridnestrovian Republican Bank, offshore residents transferred $1.328 billion to offshore companies in the period from 2012 to July 2016 and returned only $1.015 billion to the budget. Thus, $292.8 million remained abroad during this period.

According to experts' estimates, with a maximum rate of 10 percent the sum of offshore duty in 2014, for instance, might have amounted to $24 million. The draft law stipulates that offshore duty revenues will be directly allocated to the Social Stabilising Fund. The chief area of spending these funds will be the repayment of the state's salary and pension debts to public sector employees and co-financing of current payments to public sector employees and pensioners,

Apart from its social effect, the president's initiative deprives businessmen of the ability to evade taxes, exclude the provision of ungrounded tax preferences to the entities registered in offshore zones and gaining profit in Pridnestrovie. The bill also aims at the protection of Pridnestrovie's national economy against the negative impact on the part of offshore business.

Following the results of the meeting with the cabinet, the president approved the draft law and submitted it to the parliament. The bill is expected to be considered until 25 September.

 

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