PRESS: Russian cbank, finance ministry suggest new pension scheme

MOSCOW, Apr 27 (PRIME) -- Russia’s central bank and the Finance Ministry have compiled a draft concept of converting pension savings into almost private property, but a 22% payroll tax will be entirely spent on the current retirees, business daily Kommersant reported Wednesday, citing a government presentation.

The government froze the accumulative part of pension savings for 2014 and 2015, and used 6% of payments for the accumulative part to pay pensions of the current retirees to save budget funds. In December 2015, the measure was prolonged for 2016 in order to gain 342.2 billion rubles for the budget.

Under the new scheme, an employee will have to pay part of its salary to a private pension fund along with its employer’s payments to the state pension fund.

The volume of payment to a private pension fund will be set by an employee. The government will relieve a payment in a 0-6% range of a salary of the income tax and will allow the worker to pay a little less to the state pension fund. Such payments will be guaranteed by the the Deposit Insurance Agency (DIA).

Payments above 6% will not have any benefits.

(66.4559 rubles – U.S. $1)

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