Authorities want to reduce the tax burden on labor to maintain employment in companies. One of the tools currently being worked on by the government is to extend the preferential rate of insurance premiums for small and medium-sized businesses (SMEs) to the full amount of wages. Two sources close to the government told Vedomosti, and the information was confirmed by three interlocutors familiar with the situation. There is currently a reduced rate of 15% for SMEs, but it only covers the difference between the actual wage and the minimum wage (MW). From the amount of the minimum wage, companies pay at a total rate of 30%.
According to preliminary estimates of the Federal Tax Service, the measure will cost about 300 billion rubles. in a year of falling budget revenues, said a source close to the government. However, according to them, these are only approximate estimates.
In various assumptions about the unemployment rate and the date of the rate reduction, the cost of the measure can be estimated at 130-160 billion rubles. (if the level of the minimum wage for 2022 remains unchanged), calculated at the request of “Vedomosti”, the director of the group of sovereign and regional ratings of ACRA Dmitry Kulikov. Opora Rossii made a proposal to extend the preferential rate to the minimum wage at a meeting with First Deputy Prime Minister Andrei Belousov on March 28, but such a measure of support was considered in the government earlier, said a source close to the government. One way or another, consensus on this issue has not yet been reached, Belousov instructed to work out the issue and make more detailed calculations.
Another measure of support is to reduce the tax burden on labor for companies in the real sector of the economy. At a meeting of the presidium of the government commission for increasing the resilience of the Russian economy under sanctions on March 30, Maxim Oreshkin, the president’s aide for economics, suggested paying special attention to these companies. This was reported by two sources close to the government. First of all, for those who provide the bulk of jobs, but have not yet received significant support in contrast to small and medium-sized businesses and system-forming enterprises, said one source, “Vedomosti”.
According to interlocutors close to the government, the need to support such companies does not raise questions, no one is currently considering two formats of assistance. First, it is a reduction in the rate of insurance premiums – specific parameters, in particular the industry and the amount of benefits, are still being discussed. Secondly, the moratorium on the payment of insurance premiums for a period of one quarter to a year – by analogy with the measures that were taken in the acute phase of the coronary crisis, said the interlocutor.
One of the participants in the government discussions noted that different configurations of reducing the burden on business related to mandatory payments are being considered: from a one-two-quarter delay to zeroing or reducing until the end of the year. Moreover, it is planned to extend support to both SMEs and large businesses that do not fall under the measures to support system-forming enterprises.
According to sources, in the current situation, the effect of measures on the budget can be called “neutral” – the support of companies will maintain employment, at least in part. The waiver of measures will lead to larger reductions and in any case will have to pay benefits to those who lost their jobs, the interlocutor explained. One way or another, it is possible that the changes will be accepted step by step, based on how the business feels in certain industries and regardless of its size, the source said.
The representative of the Ministry of Energy stated that under the leadership of Belousov, the effectiveness of the already implemented and development of new measures to support business in the face of sanctions pressure is being discussed. Representatives of the government, the Ministry of Finance and the Federal Tax Service did not respond to Vedomosti’s inquiries.
Need another package
Earlier, the government approved the first tranche of economic support. About approval of the list of more than 100 measures with a total value of 1 trillion rubles. announced by Prime Minister Mikhail Mishustin on March 15. For system-forming companies, the priority action plan to ensure the development of the Russian economy in the face of external sanctions pressure provides for soft loans and targeted support measures (instrument parameters are not detailed). SMEs should also receive soft loans and regulatory measures, in particular the reduction of a number of fines in the Administrative Code.
Most funds, according to the document, are provided for social support, including the labor market – 545 billion rubles. This block includes payments to needy families with children aged 8 to 16, for which 360 billion is pledged. The second most expensive measure is the recapitalization of Russian Railways by 250 billion rubles. from the National Welfare Fund.
Extending the preferential rate of insurance premiums for SMEs to the full amount of wages is a rather radical measure, but such steps are required in the crisis, the government was guided by this logic during the coronary crisis, says Alexander Kalinin, president of Opora Rossii. Moreover, as the authorities plan to significantly increase the minimum wage, small businesses will actually face an increase in the tax burden on labor, he said.
The main task in the changed economic situation is to keep employment, it is obvious, the chairman of “Business Russia” Alexei Repik is sure. First of all, this applies to manufacturing companies, which were the first to feel the change in the economic situation and faced a violation of the usual course of events, the rupture of logistics chains, he added. With all due respect and the undoubted importance of the IT industry, it does not provide the bulk of jobs, while so far these companies have received the strongest support, said Repik. Manufacturing companies must also count on similar aid, at least for a period of acute turbulence. According to him, “Business Russia” offered to forgive all insurance premiums to businesses this year, provided that companies undertake to reserve the released funds in the payroll and maintain employment.
Analytical institutes predict an increase in unemployment this year by about 1.5-2 times. The Center for Macroeconomic Analysis and Short-Term Forecasting expects to increase it to 7-8%. According to the latest data from Rosstat, the unemployment rate in Russia in February 2022 fell to a historic low and amounted to 4.1%, or 3.1 million people. The Center for Strategic Development forecasts unemployment growth to 7.1-7.8%. In the long run, analysts expect that Russian employment may face structural adjustment – with the reduction of jobs in the automotive industry, metallurgy and construction, the need for staff will grow in light industry and IT.