IN RUSSIA, GROWTH RATE OF TAXES CAPS THAT OF SALARIES

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Russian taxes are growing nearly twice as fast as salaries. Analysts came to this conclusion after examining the fiscal charges paid by Russians over the past three years.

It turns out that the wallets of the Russian citizens were mostly hit by real estate ownership charges. The main contribution to the growing fiscal burden came from the tax on property, now calculated on the basis of the cadastral cost of housing. Due to this change, the amount of property tax paid in 2017 increased by 72% compared to 2015. Same with the land ownership which now costs more: in three years the charges grew by 25.4%.

According to expert reports, tax collection increased by 28% between 2015 and 2017. At the same time, mean monthly wages grew by just 15% to a little more than EUR 500.

In 2019, experts advise Russians to get ready for yet another increase of the tax burden, with the VAT being raised from 18% to 20% as of 1 January 2019. Recently, the Russian Duma adopted a law on the taxation of self-employed who are now expected to share 4% to 6% of their income with the treasury. Alongside, the lower chamber of the Parliament proposes to have the non-working citizens pay insurance premiums to the Federal Pension fund, the basic Health Insurance fund as well as the social insurance charges.

The experts analysed the consumer well-being in Russia. According to the results of this study, 22% of Russians live in poverty. Another 35.6% of respondents are in the so called risk zone. They can afford everyday food and clothing, but buying any durable items (household appliances, smart phones or computers) becomes a challenge for them.

Only 28.3% of respondents are in the comfort zone. They can afford to buy any durable goods.

An earlier study showed that only 4% of Russians may afford to have savings. This is an all-time low since 2004. At the same time, 21.7% of citizens run into difficulties in repaying loans.

According to the official statistics, by the end of 2017, 19.3 million people (or 13.2% of Russians) lived below the poverty line. According to experts, in 2018 this figure will rise.