Due to fiscal “adjustments” in Russia, a massive increase in self-employment was predicted

Member of the Expert Council of the Committee for the Protection of Competition of the State Duma of the Russian Federation, Secretary of the Association of Participants in the Electronic Commerce Market (AUREC) Dmitry Tortev commented to RB.RU about the state’s plans to force small and medium-sized businesses operating in the simplified tax system (STS) to pay VAT. According to the expert, such measures 15 or 20 years ago could have led to “going into the shadows”, but now, in the context of an increase in the number of bank payments and tax inspection activity, they will result in an increase massive increase in the number of self-employed workers.

“In the business world, a massive exit into the “shadow” is already predicted, as happened 15 or 20 years ago. But at that time bank cards were not so widely used, and the work of the Federal Tax Service was not so developed. And the tax authorities, as we see, have greatly intensified their work. Therefore, we are likely to see a massive increase in the number of freelancers. Now, in fact, this is the only loophole to get preferential treatment. Or we will see an official, and possibly artificial, decrease in turnover in the SME segment,” said Dmitri Tortev.

Another consequence of the tax change may be an increase in prices. According to the expert, a percentage of the VAT increase will inevitably be included in the price of the merchandise.

Speaking about increasing both profit tax and VAT for companies with a turnover of 60 million rubles, the Ministry of Finance refers to the overall growth of income and turnover, Tortev added. The department takes into account that the profitability of companies in Russia in total increased by 35%. But, as with the Rostat data, this is only the average temperature in the hospital, the expert believes.

According to Tortev, the Russian Ministry of Industry and Trade recently complained that the share of imported products in the non-food segment exceeds 50%, but there are also enough imported components in the food segment.

“These products must be purchased with foreign currency, payments must be made somehow with an insane commission, delivered, overpaying for logistics by 30 to 40%. Someone else has to do it, so companies have to take into account the salary expectations of employees,” said Dmitri Tortev.

The expert believes that in the future a weakening of the ruble is expected and the nominal income of companies will, of course, grow, they will have to transfer more and more taxes and not increase income for their own development.

According to the Federal Tax Service, the number of users of the special tax regime in 2023 increased by 39%, from 6.6 million to 9.3 million people, and their total income reached 1.4 trillion rubles.

As reported by RB.RU, the state plans to further adjust the Russian tax system starting in 2025; Small businesses will have to pay VAT when using a simplified tax regime. The innovations will affect commerce, restaurants and those who rent large properties.

The amendments submitted by the government of the Russian Federation to the State Duma of the Russian Federation on June 3 are not yet final, most likely they will be subject to “adjustments” taking into account the specifics of the industry, says Russian Support expert; he clarified to the publication.