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Expert explains why a 30% personal income tax rate for the rich will reduce tax revenue – Rossiyskaya Gazeta

Date: April 20, 2024 Time: 15:46:01

Egorova explained that this could lead to what the tax system was avoiding when it introduced a flat 13% personal income tax in 2001: people will try to take part of their income into the shadows. “Simple logic dictates that if a citizen earned 10 million a year, he will pay a tax of 3 million, and if he earned 9 million, then 1.3 million. There is no motivation in a limit situation to prove 10-15 million in reais. The consequence will be that, on the contrary, tax revenues will decrease,” says the expert.

He noted that it is possible to obtain an annual income of 10 million if you earn 833,333 thousand rubles a month or more. Although it turns out to be a significant sum, it is not the income of the oligarchs. According to Egorova, this is what top managers and owners of small businesses receive.

The expert stressed that since 2005, initiatives have been periodically carried out to return to a progressive tax scale. Many cite foreign experience as an example, where in many European countries this system has been in force for a long time. However, it is important to note that in these countries people also use tricks to avoid showing the actual tax if income is at the level where the tax scale goes up. Furthermore, these examples are not relevant to Russian reality due to a completely different tax system, which will have to be reconstructed if we want everything to be completely identical.

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Hansen Taylor
Hansen Taylor
Hansen Taylor is a full-time editor for ePrimefeed covering sports and movie news.

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