taxes
James Meek in Moscow
CONFUSION and chaos reigned across 11 time zones last week as hordes of Russians fought bureaucratic obstacles in a final attempt to throw off their reputation as a nation of tax-dodgers and settle their accounts with the revenue.
In a country where people commonly accuse the government of stealing their savings by hyperinflation and pyramid schemes, and not paying their salaries, it was a strange sight.
Tax officials, stunned by the queues of people volunteering to beat the April 1 deadline for filing tax returns, struggled to cope with the influx.
Among the model taxpayers cited by the authorities were the former Soviet first couple Mikhail and Raisa Gorbachev. Their representatives handed in returns worth 1- billion roubles ($172800).
The rush to tax offices was only partly due to good citizenship.
The government, desperate for income to pay its debts, has announced draconian penalties for tax evasion, including up to three years in prison.
A series of adverts has underlined the message, alternating pleas for help (pictures of suffering invalids) with threats (“The tax police have guns, and know how to use them”).
At tax office number 3 in central Moscow, where the corridors are crowded with tense “biznesmeni”, sceptical accountants and baffled middle-aged workers, staff said the number of conscientious taxpayers had gone up by half since last year.
All are rouble millionaires: the income tax threshold in Russia is 12-million roubles ($2080) a year.
“I don’t know if it’ll help anyone, but it just seemed like the right thing to do,” said Galina, an engineer waiting to hand in her tax form.
“Everyone was afraid of being fined,” muttered a woman sitting next to her.
“No, it wasn’t fear,” said Galina. “We talked about it at work and we decided it’d be a kind of investment – for the teachers, the kindergartens, the schools.
“Of course we’re afraid they might spend it on the wrong things, but you have to do something.”
Vsevolod Nikolsky, an accountant, sat glumly in the corridor with a fat file of income declarations from the building company where he works.
He complained about the burden: 10 different taxes (including 35% income and profit tax, 40% payroll tax, and 20% VAT) and contributions to four social funds for each worker.
“You know, the Russian tax system is very stupid,” he said.
“There’s the white market and there’s the black market. Those firms who play in the black market don’t pay the government anything because the mafia controls everything. And the firms who do pay suffer from this fantastic weight of taxes.”
Asked why his company was not in the black market, Nikolsky grew uncertain, as if fearing a trap.
“We’re honest people. I don’t know. I’m not the boss.” He thought for a moment, and grew bolder. “We’re an ordinary building company. We don’t do anything illegal. So why should we hide our profits?”