Translated material
Interest dispute
Dmitry Medvedev does not rule out tax cuts and entry barriers to the State Duma
Russian President Dmitry Medvedev met yesterday with the leaders of A Just Russia, thereby continuing a series of consultations with parliamentary parties. Let us recall that earlier, on April 8, the head of state held a meeting in a similar format with representatives of United Russia . And next week - approximately on May 12 - a meeting of the head of state with the leadership of the Communist Party of the Russian Federation is planned.The main topic of the meeting between the head of state and the Social Revolutionaries was the further development of the country's political system within the framework of the reforms proposed by the president in his message to the Federal Assembly . To help the head of state, the leader of A Just Russia, Speaker of the Federation Council Sergei Mironov voiced a number of small and large legislative initiatives born from the “Socialist Revolutionary” minds. First of all, there was a proposal to lower the threshold for parties to enter the State Duma, which currently stands at 7%. The leader of the Social Revolutionaries drew attention to the fact that even with the 5 percent threshold in 2003, only four parties were able to get into the Duma, as in the last Duma elections in 2007. He also expressed concern about the registration process of political parties. “Today it is very, very difficult to create a party and carry it out according to the documents of the Ministry of Justice. In addition, it is very difficult to obtain registration for a party to participate in elections,” Sergei Mironov complained and asked Dmitry Medvedev a rhetorical question: “Is it worth limiting parties in the election process at all?”
In response to the proposal to lower the barrier, the head of state tactfully replied that the value of the “passing score” depends on the degree of development of the Russian political system. According to him, the high barrier was introduced in order to spur the development of the party system. However, Dmitry Medvedev did not rule out the possibility that over time the 7% figure could be revised downward.
The initiatives of A Just Russia did not end there. The party proposes to improve domestic local government and support it financially by increasing the tax base of municipalities. It is assumed that the income of municipalities can be expanded through additional taxation of expensive real estate located on their territory. In addition, the Social Revolutionaries would like to leave all taxes received from small businesses entirely to municipalities, rather than transfer them to the regional level. According to Mr. Mironov, “this will lead to incentives for municipalities to create small enterprises on their territory.” And to optimize management at the local level, A Just Russia recommends, in some cases, creating common administrations for several municipalities.
In turn, Dmitry Medvedev called for special caution when approaching the issue of changing tax legislation during a crisis. “ The tax on real estate (including expensive property in favor of municipalities, which A Just Russia advocates for. - Ed. ) is a discussed topic, and it is quite possible to improve legislation in this area,” the president agreed and here he made a reservation that “you need to do this extremely carefully.”
According to the head of state, taxes in general need to be changed very carefully . In this regard, the head of state started talking about another long-discussed idea - reducing the value added tax rate. “The goal is to reduce VAT; it is not removed from the agenda, no matter what individual officials say. This is absolutely certain,” the head of state assured. At the same time, he recalled that when making a decision to reduce taxes, it is necessary to monitor the filling of the budget revenue base. In a crisis, this becomes especially relevant, since, according to Mr. Medvedev, “currently there is a contraction in budget revenues, and quite a significant contraction.”
“In this situation, the cost of any mistake can be very, very high,” the president warned. Nevertheless, he believes that government officials and the public need to continue discussing the issues of reducing the tax burden on small businesses and tax incentives for innovative businesses.
Dmitry Medvedev also did not ignore the topic of the financial crisis. He admitted that direct government support for the Russian stock market for anti-crisis purposes “has led to nothing,” and the current upward dynamics on it have not yet become a trend. True, according to the president, the ineffectiveness of such support is not only a Russian, but also a global problem: “Unfortunately, even quite large injections into the stock market of certain countries have not changed anything.”
Noting the “good growth” observed recently in the stock market, the president urged not to draw overly optimistic conclusions: “This does not mean that we have already entered the trend when the development of the stock market will be of such an upward nature in general.”
At the end of the day, the head of state praised the Socialist Revolutionaries: “Your party has grown stronger, turned into a powerful political force... You have your own position, you do not support all initiatives coming from the president, and that’s normal,” noted Dmitry Medvedev, in turn, not supporting all initiatives emanating from A Just Russia. And that's okay too.