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Imposition of tax on non-working people is deterred by difficulty of determining and identifying those liable to such tax, says first deputy labor minister

The imposition of a tax on non-working people is deterred by the difficulty of determining and identifying those liable to such a tax, Pyotr Hrushnik, Belarus’ first deputy minister of labor and social security, told reporters in Minsk on Friday.

“Unfortunately, no one in the country has yet estimated what economic benefits we would have if we caught someone and spent funds for catching such people and establishing their status,” Mr. Hrushnik said.

However, he noted that “life will force” authorities to return to this issue. It will be necessary to determine whether these people are idlers or they have an occupation and earn a certain income but do not pay taxes, he said. “These are absolutely different things,” he added.

First Deputy Finance Minister Uladzimir Amaryn said last week that no tax would be imposed on non-workers in 2014 because the adopted state budget and tax plan for the year made no provision for the introduction of such a tax.

“In our opinion, people who do not pay income tax and do not contribute to the Social Security Fund but have access to free medical and educational services and government-subsidized public transport services and utilities should somehow compensate for the costs of those services or pay for them,” Mr. Amaryn said.

However, he noted that this matter would hardly be settled through taxation.

According to Mr. Amaryn, one of the possible solutions is to issue “social cards” to working people, which would entitle the bearer to a certain range of free services, whereas non-working people would have to pay in full for those services.

Mr. Amaryn added that the ministry of labor and social security was considering the possibility of introducing such cards, but Mr. Hrushnik noted that the idea would require a very long period of consideration before it could be implemented.

Mr. Hrushnik suggested that the issue should be postponed at least until after the National Statistical Committee published its report on the 2013 labor market trends.

The report, expected in May, will help gauge how many people want to work in Belarus, who many people seek employment abroad and how many people do not want to work at all, Mr. Hrushnik said.

According to him, in 2012, there were 30,200 Belarusians who did not need to be employed, more than 20,000 people who saw no need to work, 130,000 housewives and 211,000 people willing to work.

Svyatlana Kretava, head of the finance ministry’s Main Social and Science Funding Directorate, claimed in November 2013 that authorities had already drafted a bill that would impose a tax on non-working people.

The bill defines those who can be viewed as non-working people, Ms. Kretava said, without elaborating.

“Afterwards, a decision will be made for them to contribute to public revenues by paying a special tax. They should pay for what they have actually consumed while using free educational and medical services,” Ms. Kretava said, speaking at a meeting of several standing committees of the House of Representatives.

According to Ms. Kretava, non-working working-age people would have to pay an annual tax pegged to the Base Rate (currently 130,000 rubels), which could amount to 2.6 million rubels a year.

Belarus has about 400,000 people who "parasitize on the social policy of the state" by not working or by holding unofficial jobs, Deputy Prime Minister Anatol Tozik said a year ago, suggesting that measures be taken against those who pay no taxes.

Prime Minister Mikhail Myasnikovich warned last summer that a tax might be imposed on non-working working-age individuals. There are about 445,000 such people in Belarus, who in no way contribute to the development of the Belarusian economy but still receive social benefits, he said.

The government is considering how non-working able-bodied individuals could partially compensate it for social services provided to them and their families, Mr. Hrushnik said in late September.

The constitution's Article 56 requires citizens to pay taxes by way of compensation for the government's expenses, he noted. From the standpoint of social justice, all working-age citizens should pay taxes in any country, including Belarus, he stressed. //BelaPAN