Putin says Russia to have no progressive income tax, sales tax

MOSCOW, Jun 7 (PRIME) -- The Russian government will soon decide on tax changes but it plans no differentiated scale of the personal income tax and a sales tax, President Vladimir Putin said during a live Q&A conference with the people on Thursday.

A differentiated personal income tax scale looks socially justified but results in concealment of income, Putin said. “Extra wages in envelops and so on start in this case straightaway. So the fiscal result is almost zero while there is much noise and deterioration of the investment climate is evident, so I see this as unviable.

“Concerning the sales tax… Firstly, we used to have this tax, the turnover tax. This is a serious burden on the economy in general and a serious burden on citizens as a result since this will inevitably result in a significant growth of inflation.”

He added that the tax policy stability for the next six years is the government’s absolute priority during consideration of the changes.

Russia is in for a stable, though modest economic growth, Putin also said.

“Firstly, we have started a stable growth trend of the economy. Yes, growth has been small, modest, as I have said. But this is growth, not a decline… Industry and agriculture are rising in a stable way,” Putin said.

He said that life expectancy and income have started to rise sustainably. Salaries have grown by 1.9% and real wages by 3.8%, the president said.

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