Small and medium business representatives have named their new discussion venue the Business People Forum. Small business owners plan to gather together and develop their vision of solving major economic problems of the nation that are affecting business climate in Ukraine in one way or another.
“The main task of this venue is to formulate the laws that the private sector needs and, through dialogue with the government, to force it to pass these laws,” says one of the forum’s organizers, Chairwoman of the Verkhovna Rada Committee on Industrial and Regulatory Policy and Entrepreneurship Natalia Korolevska.
“Entrepreneurs need to consolidate themselves and act as checks on the government, because unchecked government is nowhere and never efficient,” president of the Center for Economic Development Oleksandr Paskhaver comments on the business community’s initiative. According to him, they need to become active participants in such dialogue, for the country is now experiencing “an onslaught on the sovereignty of private property.” He describes it as a situation when titles of property are still held by business owners, but the authorities claim at least equal status in administering these properties.
The World Bank director for Ukraine, Belarus and Moldova Martin Raiser attended the forum, too. He thinks that reforms should make life easier for entrepreneurs. For now, however, the effect of such changes is mostly nominal only. Raiser recalls reduction in frequency of government inspections of businesses as an example of a mostly inefficient change. He says the World Bank actively supported this idea in 2007. And what were the results of it for the business community? It turned out that 74 percent of companies were inspected in 2008, and the same share of them was subject to inspections last year. That is, the law had not had the desired effect on businesses. “I think that Ukraine is currently in need of a strong and constructive dialogue more than of anything else,” he concludes.
Another guest of the forum, member of the State Duma of the Russian Federation and Chairman of its Committee on Property Viktor Pleskachevsky sees liquidation of 800,000 Ukrainian enterprises in the last few years as an indication that the effective tax rate prevents businesses from being established, much less expanded. Therefore, in his comments for The Day, he advises the domestic private sector to actively fight for limits on the regulatory powers of government and maximum transfer of these powers to the industry organizations.
While the new venue hosted its first meeting in Kyiv, another event, the Assembly of Small and Medium Business NGOs of Ukraine took place in Zaporizhia. The participants talked about instances of tax intimidation, beatings of business movement activists, as well as repressions against them that are allegedly carried out by militia and prosecutor’s offices. Quite a lively debate ensued on the issue of the land reform. The assembly’s participants called for preventing the sale of agricultural land because it could end in disaster, although some of them expressed opinions to the effect that land sales may be allowed with some conditions (fair land price assessment, establishing of rule of law in the country in general and land use practices in particular, and prevention of absenteeism).
Small business representatives from Zaporizhia called for their fellow entrepreneurs to distance themselves from the existing political parties and attempts to enter the legislature or local councils, because the latter would sometimes break even existing laws. Instead, the meeting’s participants declared their will to fight for the minimum program that includes complete abolition of the VAT, reduction of the payroll taxes by at least a half and introduction of the tax on final consumption. Their maximum program calls for establishing “a self-defense system of the business community within the Free Space social movement’s framework and formation of self-organized citizens’ committees and territorial councils of the unitary republic of Ukraine.”
