Semenukha: Government’s desire to increase the unified social tax is a sign of panic

The government does not have enough money for pensions, and it is becoming more and more difficult to conceal this fact. This was stated by MP Roman Semenukha during a briefing in the parliament.

According to the people’s deputy, the recent proposal of the Minister of Social Policy Andriy Reva to expand the tax base of the unified social tax in the amount of 22% from 15 minimum wages to 25 is a sign of panic and an attempt to somehow save the situation with a catastrophic lack of funds in the Pension Fund.

“It turns out that from small salaries the full amount of UST is paid, while from the big ones only a part is paid, and the relevant Minister believes this “injustice” must be corrected,” notes Roman Semenukha. “The Bolsheviks also said that there could be no rich people in the Soviet Union. Everyone must be equal and poor. It seems that the government is a “worthy” heir to this ideology. After all, it plans to increase taxes for those who are receiving official incomes and are paying UST.”

Today, UST for salaries up to 55,845 UAH (15 minimum wages) is 22%, for larger ones – the rate of deductions is gradually reduced to 5%.

At first glance, the Minister’s calculations are simple. 51,000 Ukrainians with high wages together earn about 6.7 billion hryvnias a month, an average of 131,000 UAH per one such employee. UST is paid from half of the salary. That is, according to Reva, the budget loses about 10 billion UAH every year.

“But the maximum old-age pension in Ukraine cannot exceed 10 living wages set for disabled persons, or UAH 14,970 (from December 1, 2018). So a person whom the state will make pay about 28 thousand hryvnias per month in the form of UST can, at best, qualify for a pension that is half that amount (if there is the necessary insurance experience),” Semenukha emphasizes.

According to the people’s deputy, such absurd proposals of the government are due to the shortage of UST, which is observed monthly in the amount of millions of hryvnias. This is especially noticeable in recent months: in September they collected 1.5 billion hryvnias lesser, in October – 2.8 billion lesser.

“Hroisman’s government continues solving pension problems not through the introduction of a funded pension system, not through the creation of conditions for new jobs, and an increase in the number of payers of UST, not through to economic development, but through additional fees for businesses and citizens. This is a “Soviet” approach. The Soviet leaders were very good at dividing, but they never knew how to multiply,” concludes Semenukha.

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