Prime Minister Vladimir Putin set out his agenda for the future of Russian business on Thursday at a meeting with entrepreneurs, promising less regulation and taxes and asking business to help plan its future.
In an speech to the Russian Union of Industrialists and Entrepreneurs’ congress in Moscow, Putin, who is the frontrunner in the March 4 presidential elections, promised the Russian government will not raise taxes on non-oil and gas sectors of the economy.
The government is working out a "tax maneuver" to improve the fiscal burden on the manufacturing sector, he said.
"Calculations for such a tax maneuver are being made now. We should act in balance as every step has an effect on the whole chain. I want to stress that we will not raise the tax burden on the non-oil and gas sectors of the economy," Putin said.
"We must determine the level of key taxes and fix this decision. We understand it clearly because small, mid-sized and large businesses must have a clear understanding of the government's long-term fiscal policy," the prime minister added.
Putin called on the country’s business community to draw up a road map for improvement in the country’s poor investment climate.
“I propose that you and your colleagues draw up road maps…Certain steps – on improving the legal frame of state bodies. I am sure that the participation of businessmen in this will help avoid unnecessary mistakes,” the premier said.
Putin also called for a review of the penal code to prevent undue pressure and harassment of business by bureaucrats and law enforcement officials.
“We will continue our effort to make criminal law more humane,” he said.
“It is important in particular to eliminate [legal] grounds for arbitrariness and repression.”
This especially applies to so-called economic statutes, he went on, adding that on many of those an investigator may initiate criminal proceedings without a formal complaint.
“We should exclude all grounds for abuse,” Putin said.
The issue of the legitimacy of privatization in the 1990s in Russia should be closed, and a mechanism for doing that should be devised, Putin added.
“We need to turn this page,” he said. “We need a closure on this period – different methods are possible, and of course we need to discuss this with the public, with the expert society. But in such a way that society really accepts this variant of closure of the problems of the 1990s, and these, frankly, dishonest privatizations,” he said. Putin also proposed a public discussion on a luxury tax that he pledged would not affect the middle class.
Putin said the luxury tax should be “a sort of publicly declared payment for favoring excessive consumerism and vanity over investment in development.”
He said that the criteria and principles of paying this kind of tax should be clearly outlined.
“I think these criteria should be outlined in an open dialogue with the public and businessmen,” Putin said.
Procedures for issuing permits and design approvals in the construction industry should be radically simplified in a bid to boost building in Russia, Putin said.
“I suggest that we should use the best world practices to radically simplify all the mechanisms for approving project documentation and the issue of construction permits,” Putin said.
Russia also needs to switch from an authorization system to a notification system for construction approval documents, Putin said.