On the eve of each oncoming election populism gains momentum in Ukraine. Often it will reach the level of “developed socialism,” which lured the Soviet people with promises of rivers of milk and honey – or at least an individual apartment to each family. But since we have been there and seen that, now new slogans are being coined, set up for the “struggle for a just society.” Curiously, even some renowned economists have been called to these pink colors at the dictation of party discipline. Indeed, Oleksii Plotnykov, chairman of the subcommittee on international economic policy, MP and member of the Party of Regions, said on TV that “the thesis ‘the rich will feed the poor’ is as vital as can be. The rich should take care of the poor in a country, where the inequality gap is at 35 or even 40 times.” According to Plotnykov, in developed economies this gap does not exceed 5-7 to 1. “Proceeding from this standpoint, there are all reasons for the wealthy to take care of the economically disadvantaged, that is, to pay additional taxes on their super high revenues, so these taxes can fill the budget and finance the poor citizens.”
Plotnykov threatened as he went on elaborating the subject: “There is a draft law, which will be passed, and evading these [luxury. – Ed.] taxes will be as bad as evading any other taxes. Thus, it will become a criminal offence, an offence against Ukrainian legislation, and conscientious citizens will pay this tax.” However, how many conscientious citizens like that do we have?
Andrii Pavlovsky, MP for BYuT- Fatherland and minister of labor and welfare in the opposition government, considers the draft law on wealth and luxury tax a mere profanation: “In Ukraine the gap between rich and poor has been growing over the recent years, and this causes social tension. On the other hand, an election is coming, and government would like to show that it remembers about this grave problem, and will fix it.” Pavlovsky is convinced that “only a handful will be paying this tax, while big business will continue exporting its capitals to offshore banks.” He champions an alternative draft, proposed by BYuT-Fatherland, which includes “both progressive tax rate and a proposal to tax offshore operations and increase mineral royalties.”
We reckon that Serhii Tihipko, vice prime minister and minister of social politics, might also want to join in this fight for true social equality. Last Friday, speaking to the veteran workers of Zorya-Mashproekt in Mykolaiv, he declared that “2013-14 will become the years of growing social benefits, first of all, pensions.” The funds will come from legalization of labor market and wages. “We expect a considerable increase of revenues to the Pension Fund; we are planning to use this money to pay out and increase pensions.” Strangely enough, it looks as though Tihipko did not count on the law on wealth and luxury taxation.
Anatolii Akimochkin, head of the Makiivka municipal regional organization of the National Miners Trade Union of Ukraine, sets no hopes on this law either. In his comment on the debates on the luxury tax law, Akimochkin told The Day: “I am of the opinion that this tax will have no base, because those who own luxury goods keep their assets elsewhere, but not in Ukraine. If the draft is passed and enacted, I doubt it will allow to perceptibly increase revenues to Ukraine’s public budget. Many laws, which are passed in Ukraine, aim rather at a certain PR effect than at practical goals. I believe that laws on social benefits should be debated on The Day after the election, not amidst the campaigning heat.”
