Zlotnikau: State increases VAT, limits market

The value added tax will increase from 20% to 22% in 2014. The corresponding amendment will be made in the Tax Code.

Increasing the tax will help fill the budget, Leanid Zlotnikau said. However, it depends on what the money will be spent for.

Zlotnikau: "They need market reforms that will make the population pay more for housing and communal services. They need private investments rather than the state ones. And it should be done in market economy conditions! If our society and economy were really being modernized, there would be no need for additional budget money. It means that the state is trying to solve the problems that should be solved by the market without increasing taxes.”

The population will not like his market economy suggestions, the economist admitted. But the state spends more on housing and communal services than a citizen would pay to a private company, he said. And it spends it less efficiently.

Photo: belsat.eu