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Published: July 18th, 2016

Vladimir Putin has demanded to withdraw from the so-called "garage" of the economy 30 million. Russians, which is about 40% of the working population. Will the Russian authorities be able to defeat the gray labor market and fill the budget in this way? Will the citizens themselves agree to come "out of the shadows" and is not this fight threatened with an explosion of discontent? "Business Online” talks to Mikhail Delyagin, Boris Titov, Oksana Dmitrieva, Vladislav Zhukovsky, Alexander Lavrentiev and others.

Simon Kordonskii - Professor of Higher School of Economics :

— They have heard a bell toll, but do not know where. I would have said so. It's a different economy, it is not the shadow and not the "garage". It's the economy, which has always existed, and during the Soviet era it was, even before Khrushchev's time. Khrushchev in 1956 nationalized the industrial cooperation that provide up to 70 percent of consumption in the country. After that, in fact, in the 60's it began a deficit. And what was the production co-operatives, a thing of the shadow, then there craftsmen, private illegal dentists. And when cooperatives appeared in 1989, this craft cooperatives began to recover, considering themselves a business, although business they were not. We have no business, some craftsmen. Actually, our country is living with crafts. There are state crafts such as "Rosneft" or "Rostech", and there are non-governmental.

Of course the State will not be able to win against the gray market. The fact is that if they start seriously to fight with the security forces, they also need to place 30 million people something to do. There's not even 30 million people, and more, because how to count the teacher in school who works also as a tutor? Who is he? Or a doctor who has a private practice, being in the hospital, using its resources? This craft economy is something invincible. The scale of it is the same as Stalin's collectivization.

Mikhail Delyagin - Director of the Institute of Globalization Problems:

— If they will take in head to win against "garage" economy, the way any war with reality, it will cost very expensive for people, but it would be fatal to those authorities. It is also necessary to understand that the bulk of the "garage" economy - it is the people who work in the service sector rather than in the garages. To do this, you just need to normalize the taxation of wages. After all, we now have a formal flat tax scale. In my opinion, we, together with Bolivia are the only countries in the rest there are normal progressive scale. If you look at the integral imposition of a payment based on a regressive scale of social contributions, here the poorer you are, the more you pay. Representatives of the "United Russia" has repeatedly told me in a public debate and on a camera, it is true that this is idea of "United Russia" about justice. Naturally, when you have salaries below the subsistence level, general taxation to the general social contribution and income tax exceeds 39 percent, of course, in this situation you physically can not pay. It is prohibitive taxation. Then you go into the shadows. This happened due to the fact that the richest part of our people can either create individual enterprise and pay 6 percent, or to pay nothing at all using all sorts of tricky offshore schemes or tricky operations with securities.

We have created a tax haven for billionaires and hell for everyone else. This is the reason why we have the pension crisis, because when people do not pay taxes, they do not pay contributions to the pension fund first of all. But Russian liberals, representatives of the government, "United Russia" categorically do not want to change the situation, and even recognize it as a problem. They brazenly and cynically ignore international experience, ignoring all the arguments of common sense simply because, as far as I can tell, that the government leader of the "United Russia" Mr. Medvedev simply do not hold not very rich people.

Irshat Minkin - Deputy General Director for Investment Projects and Investor Relations of "Kazmetrostroy":

— The "garage" economy has two reasons of its existence. First, people working for themselves, want to evade taxes, to put more in his pocket. The second more significant: the desire of employers to save on taxes, with the result that the worker loses the lion's share of social guarentees. This is a flagrant violation of the law, which must be fought just as organized crime.

If you predict the development of situation in the future, I think that this situation will not last long, and the quantity of people who will agree to work in the shadows in whole or in part, will become increasingly smaller. The task of the state in this case is to find a balance that encourages and employees, and the company out of the gray zone. Today, it is still clearly not found.

Vladislav Zhukovsky - Economist:

— It seems that Russian authorities are allmighty. They can win against economy as such, they have almost won against the population and small businesses, and could well win against business and everything. Pensions defeated outright, I believe, by our great officials. Therefore, it is not necessary to doubt their ability. Another thing is that it is not easier for no one.

We have a caste of untouchables, unelectedб controlled by nobody in such a society's new feudal lords, let's say, our boyars and ruling aristocracy, who are interested in the creation of unlawful, non-transparent legislative field and where they drive almost the entire economy. According to data of "Rosstat" shadow economy is 20 - 25 percent of GDP, which is around 16 - 20 trillion rubles. According to IMF it estimates - about 40 - 50 percent, according to various experts and anatomical groups, there are about 60 - 70 percent of all in the shade. They are the ones who are completely or partially does not pay taxes, the budget, extra-budgetary funds, those who manipulate wages, pension contributions, payment of taxes on dividends, income, and so on.

That is a wonderful business, first of all driving everybody into the informal sector of the economy and just make sure that it was impossible to work normally. And now what? The budget is empty, strewed in front, the deficit of 2.2 trillion rubles, now 2.8 trillion rubles, will be released under the 3.2 trillion rubles, the balance of payments of the hole in the hole, the current account surplus has fallen three times in foreign trade two and a half times, for the first or second quarter of this year at all frank decay. All locally becomes empty, so you need to throw the final stranglehold, it is necessary to tighten their belts and not only on the abdomen, but also around necks of the people, businesses, pensioners, the elderly. Therefore, all the "no money, but you hold yourself" good luck.

Valentin Katasonov - Chairman of the Russian Economic Society named after Sharapov:

— What a strange phrase - "Garage Economy". I understand this is a gray economy. I think that this is unlikely to succeed. The authorities herded the people into the gray sector of the economy, it's not of a good life that people have to somehow survive in the so-called "garage" economy. Therefore, in order to radically solve the problem, you should really start the import substitution. For many years wehave not built new businesses, which would have replaced imports of industrial products. Our import substitution occurs mainly in agriculture, where, in general, the employment gains at the expense of import, according to some estimates, amounted to less than 1 million people. But this does not solve the overall problem. So do not start from the end to solve the problem. People need the guaranteed right to work. The Soviet Constitution had that right, right now it is not. This, I believe, is the first duty of government.

Many times I have to say that small and medium business - it is actually a way of survival. It is not a creative economy. Look, we have 1.5 million strong men engaged in various security offices, instead of creating something, they simulate some kind of activity. Recently Basil Simchera said that we have somewhere around 30 million people who are engaged in creative work - it is the maximum with the total of 140 million people. If you take half of it, - here it is able-bodied population. It turns out that the other - the people who survive. They want to be engaged in creative work, but they are not allowed. It just shows how our economy is weakened. I use this figure to show that we need a mobilization economic model. This means the use of the potential of the economy to 100 percent. Let's take a simple physical indicators - the number of people engaged in creative work. The rest - this is actually hidden unemployment.

"PUNITIVE ACTIONS ON THE GETTING THE “GARAGE” ECONOMY OUT OF THE SHADOWS WILL TRIGGER THE GROWTH OF DISCONTENT AMONG MASSES"

Boris Titov - Business Ombudsman:

— The first image that comes to mind to people after reading this news - this is, of course, some raids and round-ups that will fall on the people working without official registration. In our opinion, this picture is unrealistic. First, the balance of costs and eventual outcome unfavorable to the state. Second, the punitive actions on getting the "garage" economy out of the shadow will inevitably provoke the growth of discontent among the masses.

We have a peaceful way to solve the problem. We have being promoting "self-employed citizen" status legalization ( "individual entrepreneur without the right to employment of workers") for several years. And the legalization of self-employed work we offer for the most reasonable terms. All you need to do - to apply to the tax and to get a patent for a certain period. Upon the expiry of the patent self-employed status shall be automatically terminated, no hassle, as it is now when removing SP from registration, should not be. In addition, we offer a self-test ban, to relieve them of the obligation to provide statements. At the same time we reduce the tax, credit, and the administrative burden for small businesses. That approach is the only one that will lead the "garage" economy in the light.

Oksana Dmitrieva - a member of the Duma Committee on Budget and Taxes:

— The incentive on the part of the worker - pensions, which depend on the length of service and earnings, and when the pension legislation is not changed 33 times. Second, health insurance, which gives some assurance of health services, the same applies to social security, particularly the issue for small businesses. They pay these fees, and the system is set up so that then do not get no sick or maternity leave, etc. The most important thing -.. This pension system. Constantly changing legislation, and no incentive to work in an open and demand that the employer is not in real wages due to the insecurity, instability and volatility of the pension legislation.

Another point, which also drives in the shadow - are migrants who work without social package, a black or gray, does not ask for anything, thus dumping in the labor market. Therefore, citizens of Russia, are also offered such conditions . On the part of the employer's part of the shadow wages - is small and medium businesses. The main incentive for small businesses to exit out of the shadows and display all the real speed - this is a real possibility of obtaining cheap credit. And when applying for a loan, of course, need a legal assessment of trafficking and property. If they clearly know that there is none of that, all the momentum are in the shade or partial shade.

Citizens will want to come out of the shadows, if there is an incentive - social package. The second stimulus - the mortgage. It is also available for a very few, where you have to take into account the real actual earnings. People are also interested in the open legitimate earnings. And for the small business stimulus - it's cheap loans. And we have a small business dispossessed, they all work on the rented property. If that was their real property, there would be less firms that are opened and closed. It is a system, it is necessary to unravel this tangle. This is just the tip of the iceberg, all the problems are inside. People and businesses are forced to go into the shadows.

Alexander Lavrentiev - President of the Association of Industrialists and RT:

— It is difficult to say if the state will be able to withdraw the population from the shadow economy. They could not do it for 20 years, and today to bring the gray market outside, to pay taxes, to pay social insurance and so on all went at it consciously, I I think it will be very difficult to do without, frankly, the power of legislative steps. As many have said declaratively, and then the declaration is not going. So what mechanisms withdraw the informal sector, the big question. If you do need to do fundamentally, much needs to be changed in the system of the economy. We have not done anything, and in order to make it function normally.

Ildar Ablaev - Doctor of Economic Sciences, Director General of ANO "Tatar Academy of innovative economic management":

— Theoretically, of course, so you can supplement the budget, but paramount here to solve the problem itself "garage" economy, as small and medium business now go into the shadows more and more. Therefore, to move toward a white official market correction is needed. And one of the tools that may be is a decrease in taxes for small and medium businesses. And we need to stop "harassing" it. That is necessary to create conditions for people to work in peace, and this requires tax reform, we need a progressive scale of personal income tax, it is necessary to cancel VAT on imported equipment - these are the first steps. To be rich in the state, it should not smother their breadwinners, ie entrepreneurs. This approach, I think the most correct in our situation.

With regard to the extent of the problem, they are huge. Because the shadow economy on average in Russia is 50 percent of GDP. If we look at industry, the construction, agriculture and trade, there is about 70 percent of the shadow economy. Stocks of huge money in the country, and they revolve here in this offshore. Private offshore in the country - it is the shadow economy. And there is an external offshore - it's foreign banks, foreign offshore companies, Russian trillions of dollars revolve there. When necessary, they return part here in Russia. It is a system of communicating vessels. We can not say that if the money went to offshore, they are gone, no. They have not gone anywhere, and when necessary they are returned in the form of foreign investments alleged here.

"MANAGEMENT STYLE" MY BOSS HAS MANY INTERESTING IDEAS" CAN LEAD TO THE FACT THAT ALL HENS WILL PERISH DURING THE EXPERIMENT!"

Edward Yunusov - CEO TH "Chelny-bread":

— Will this statement have strength - it will depend on how severe it is. A lot of applications are done, and that's how the system is ready to accomplish the task, unfortunately, my competence is not enough to evaluate. The problem of the informal sector is complicated, large-scale, and we ourselves, despite the fact that we are a small company, are significant enough taxpayer. And we see that kind of imbalance is clearly present in our market. What's in the trade, which is in the production of bakery products, confectionery.

It is not difficult to compare our salaries, how much we pay officially, and many others. In general, the issue of the "garage" economy is necessary to put as a priority. And we actually feel the tension, we all know that the budget is bursting at the seams. So what we want is to believe that this statement are serious and followed up with action.

Maria Gorshunova - General Director of LLC "PKF" Maidan ":

— Might if to return the state it was, in my opinion, until 2014, when premiums have increased by 30 percent. The issue of the informal sector is very ambitious. In a crisis, when the business is trying to save absolutely everything, in addition to reducing the number of its employees, of course, takes their income from the taxpayer. To put the ruble in the pocket of his employee, it turns out that you need to pay 43 k. to the state. That's a lot. And, of course, employees will agree to "come out of the shadows", or a business can not survive under such taxes. Any employee of the white salary would have been better, but then a lot of leave in a big minus.

Ilfat Faizrakhmanov - publisher and editor in chief of "Bezneң gәҗit" newspaper:

— There were already many such intented applications. Putin are not talking about it the first time. We need to change the laws. Currently, the employer pays enormous taxes. They must somehow be controlled. There was a time when lawmakers were not profitable to pay their employees in envelopes. But then the pension contributions were raised...

In order to patch a hole in the budget, it is necessary to adjust the income tax. Make it fair. And to the poor, and the rich did not pay 13 percent, as it is now. For millionaires, it should be commensurate with thr revenues. We have, unfortunately, everything decided by Putin. He said - and new checks will start, and there are much of them as it is. To defeat the shadow economy we need to tackle corruption. The scale of the problem is enormous, since kindergarten, finishing work. In Soviet times, at Raikin it was humoresque where bureaucrats demanded help for help. Now this, I'm the businessman. There just is not terbium bring certificates. Yet all sorts of penalties prescribed, fines if they do not provide a time. Citizens agree to withdraw from the shadows, if you make transparent taxation. I communicate with the common people, I think that there will not be an explosion. Older people say that if only there was no war. But if in its importance the TV will be replaced by the fridge, then eating a meal will be prior to entertainment, this forecast is disappointing.

Dinar Nabiullin - director of stores and service centers "Tehnoray Kompyuteroff" (Nizhnekamsk)

— If the "garage" economy is actually 30 million Russians, and it is necessary to withdraw from the shadows, than ministers, advisors and officials are unable to solve this problem (namely, "to withdraw from the shadow of 30 million working people"), as they decide the only question within its responsibility. To bring and keep these jobs, you need a systematic approach. And this is, firstly, a precise definition: who are these people, how many of them, what they produce than motivated, and similar information. The government, according to the statement of Deputy Prime Minister Olga Golodets that these people "are engaged is not clear where and how," there is no such data. A qualitative "second" does not happen without a definition of "in the first place." Management style" my boss has many interesting ideas" can lead to the fact that all hens will perish during the experiment!

Offhand: in the process of withdrawal from the shadow of a certain number of these "garagians" simply will not be able to overcome the barrier of entry to the official, the white market, and the vast majority of the many new pulled hard costs and requirements can not hold it. As a result, the number of unemployed people will increase! And what's worse: the unemployed or "garagian" - still awfull dilemma!

In Nizhnekamsk I personally do not know people that produce products in any significant scale (not socks and berries) and evading taxes. But providing services enough. In our business (repair of computer equipment), very few employed in the gray market, are qualified to be a serious competitor to us. But at the same time the work of this contributes to the development of people working acumen, intelligence, and they can find employment, work in other organizations and companies.

Anna Ritman - LLC "Ritman and Partners" (Nizhnekamsk)

— I think that the Russian authorities will be able to defeat the gray labor market and this way fill the budget in. And the will citizens agree "to get out of the shadows", if the gray entrepreneurs are shown the pros. Personally, I suffer from such a market, because gray entrepreneurs has no need to turn to lawyers.

Mansour Dzhalyaletdin - Imam Mosque "Al-Marjani":

— I think the gray labor market will be hard to beat. If desired, of course, they can. Turn administrative levers, come up with the new laws. Of course, you can win. Here in Russia everything is possible. But I think it will be very difficult. The budget will not be filled. Currently, it can be filled by other means. We also have minerals. It is difficult to evaluate the scale of the problem, but I know that there is a gray labor market.

I think that there is no gray labor market in Islam. Everything are completely different. Pay 2.5 percent from the Profit . This is called Zakat. Given for the way of Allah, that is, you pay your tax. Religious people, businessmen ask Allah to give them the opportunity to pay a large zakat, not to give more money.

Source: Business-online