Tiraspol, February 14. /Novosti Pridnestrovya/. Pridnestrovie has already begun to suffer the negative effect of the duties unjustifiably introduced by Moldova since the beginning of this year. And this influence is multifaceted. Due to the foreign policy situation, the border with Moldova is the only “exit” to the outside world. And Chisinau takes advantage of this quite consciously and actively, using methods of economic pressure, the First Deputy Chairman of the Government - Minister of Economic Development Sergey Obolonik said on air of TSV.
At the end of January, the volume of imports to Pridnestrovie decreased by 19%. The duties have only been in effect for a month, yet the volume of goods imported into the republic has already decreased.
“This is a problem for the budget, because about 10 million rubles have not been received in the form of tax deductions. And these receipts, let me remind you, form the sources for the Road Fund, that is, for the restoration of roads and the construction of social facilities (Capital Investment Fund). We were counting on these funds, we had plans. In addition, this one-fifth of imports did not reach store shelves, which reduced the stock balance, including among entrepreneurs,” Sergey Obolonik noted.
In addition to losses for the budget, a reduction in imports also means a reduction in the range and quantity of consumer goods. It is no secret that Pridnestrovie imports fuels and lubricants, a number of food products, household appliances, clothing, shoes, etc.
The inclusion of duties in their price automatically leads to an increase in the price of the goods. And if in the end its cost is too high and the goods are not sold, then the entrepreneur will simply stop bringing them to the republic.
And although within the republic itself, specialized services (on instructions from the President) ensure that entrepreneurs do not unduly inflate prices, the introduction of duties will in any case lead to an increase in the price of a number of imported items. As a result, all this will reduce purchasing activity, while ordinary people will suffer.
“An entrepreneur will not import goods so that they just sit on the shelf... Duties lead either to an increase in the cost of the goods or to their disappearance from stores. In this simple way, Moldova transfers the consumption of Pridnestrovians to its own market,” the Head of the Ministry of Economic Development notes.
This means that increasingly, Pridnestrovians will be forced to buy these goods in neighboring Moldova (since they will be cheaper there), thereby making an infusion into its economy rather than into their own.
Double Taxation Undermines the Basis of the Pridnestrovian Economy
In addition to the additional costs, double taxation entails a more serious danger. Actually, this is one of the ways to undermine the economy as a whole. After all, this leads to a number of problems: the enterprise incurs additional costs, loses income, reduces turnover, and begins to lose employees.
“This is practically killing entrepreneurial activity at the root... When double taxation occurs, it does not allow the economy to work... this immediately leads to the emergence of a large humanitarian problem. This is also a loss of jobs, the enterprise reduces capacity, which leads to a decrease in the income of working personnel,” Sergey Obolonik argues.
He emphasized that the introduction of duties by Moldova is a violation of a number of fundamental agreements, including those reached during the negotiation process.
Tariffs are a Continuation of Economic Pressure
Official Chisinau constantly makes attempts to economically strangle Pridnestrovie. Thus, since 2019, Pridnestrovian enterprises began to close their accounts in Moldovan banks. As a result, they began to purchase part of the necessary products: raw materials, components, etc., not in other countries, as before, but in Moldova.
“For us this is import, while this is the domestic market for Moldova. And these products on the domestic market include VAT. Every year, Pridnestrovie sends about $30 million to the budget of Moldova in the form of VAT, purchasing goods from Moldova,” the Minister of Economic Development said.
Furthermore, without having an account in a Moldovan bank, a Pridnestrovian enterprise cannot obtain a Euro 1 certificate, which is needed when importing goods and which is exempt from paying import duties.
Without their own accounts, economic agents from Pridnestrovie, when making payments, spend additional funds when converting currencies and conducting transactions.
“Our enterprises, without having accounts in the Republic of Moldova, find ways of transactions, but the cost of these transactions within the framework of bank commissions and currency conversion can reach 9-10%. This is also a colossal blow to each of the enterprises` economy,” Sergey Obolonik noted.
If you add up the additional costs in all these areas, the amount turns out to be quite impressive. The republic will be forced to spend approximately a third of its budget not on development, but on resisting measures of economic pressure.
“These combined reasons cause damage to the entire economy of Pridnestrovie in the amount of about $60 million. While 30 million will go to duties, 30 million - to additional bank commissions, another 30 million will go to VAT. Can you imagine the enormity of the withdrawal from our economy? The budget of Pridnestrovie is about 300 million dollars, this is one-third of the budget, can you imagine!” the Head of the Ministry of Economic Development summed up.
