

Study separates Russian flat tax myth and fact - Anon84
http://esciencenews.com/articles/2009/06/16/study.separates.russian.flat.tax.myth.and.fact

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rjurney
The tax load in Russia is actually much, much higher than the flat tax if you
take into account things like:

1) Back-breaking tariffs on all imported 'luxury' items like computers.

2) The 'unofficial' tax of about 20% (so I'm told) payable to the FSB to
actually conduct business in Russia.

3) On the spot 'fines' from police more determined to rob you than to fight
crime.

P.S. I'd just like to take this opportunity to publicly state that I hope the
entire Moscow Militsia (police) develop testicular cancer. Evil, mean bastards
every one. Rob the people they are charged with protecting.

~~~
ii
> Evil, mean bastards every one.

I know few guys who are not like that and who actually fight crime. But they
are overshadowed by overly corrupted minority (I know other guys among them
who sell drugs for example).

Things in Russia are not that simple and you exaggerate the problems. In
general, you just have to know the right people to conduct business there.
C'est la vie.

~~~
yardie
By trying to undermine his opinion you only ended up reinforcing it. 1) 20%
"business tax" or knowing the right people. Can be interpreted as paying
someone 20% of X to put me in contact with the right people. The point is
getting business done should be transparent and only the buyer and seller need
to exchange any money. Paying 10 guys in between is not how normal business
gets done.

2) I feel very strongly about police corruption. Even if it is only a small
powerful minority. The fact is the rest of them know there is a problem but
won't do anything to stop it. Which means they are part of the problem. And if
they are overshadowing then it is institutional corruption. And once they are
that embedded than numbers don't matter because every part of it is rotten.

~~~
ruslan
I hear about this 20% tax from people who never ever been to Russia. What the
fuck ? Where did you get this data from ? What 20% FSB business tax are you
talking about ? I'm Russian, I live here in Russia and doing business for
three years, I pay 13% flat tax, nothing more. One can even choose to pay 6%
off the gross income.

Taxation complexities may become effective when you start making more than
$1.5MM in annual revenue or if you are doing some business with natural
resources (oil, gas). Till then you are treated as small business. I believe
this a regular business rule for almost every western country.

I don't deny existance of curruption in Russia. It really is and very huge.
But as long as you are within the averages it does not reach you. I never paid
any bribes, I don't want to get caught on doing this and lose everything.

~~~
rjurney
I got the data from people operating businesses on a large scale, that span
Russia. It might have been 15%, actually. Its been six years. But I've spent
eight months in Russian, learning my terrible Russian. I'm not just making
this up.

Do you know anyone like that? This was Moscow, and this was payment to the FSB
for 'protection.' Nobody much argued with this at the time, it seemed. It was
better to be able to pay the FSB than to have to decide which Krysha to pay.

I'm surprised you find this strange or controversial. How much business have
you done at a high level there?

That being said, it sounds like things have improved dramatically. Thats
great, and shows how disconnected I am.

~~~
ruslan
Paying "protection" fees to Krysha (as you named it) was common in mid 90th
when government was weak and criminals ruled Russia. Now criminals pay to gov
if they don't want to follow Khadarkovsky/Ukos story (thank mr. Putin). I'm
not in Moscow (yet do visit it regularily), but I still cannot imagine paying
to FSB or to Militia or whatever if you are doing legal business. The thing is
most multi-billion businesses started in Russia in 90th are still being ruled
by criminals and one way or another are illegal or involved in money washing.

I have friends who are doing business for more than 10 years (mostly in
telecommunication and software industry), no one pays for "protection".

The others most corrupted spheres in Russia, beside natural resources, are
land estate and development business, mostly because there are huge money
rolling around. Avoid this three and nobody will "care" about you or your
business :)

