04 June 2004 21:48
Russia will find it hard to double GDP, lower inflation - Moody`s (Part
2)
There are factors that the Russian government can control, such as
natural monopoly tariffs, but there are many factors outside its
MOSCOW. June 4 (Interfax) - Russia's goal of doubling GDP by 2010 and reducing inflation to 3% annually is a
salient one but will be hard to achieve, Jonathan Schiffer, sovereign ratings analyst at Moody's Investors Service,
told Interfax.
Russian oil companies pay less tax compared with other countries,
and now it looks like taxes will go up in the oil sector and down for
small and mid-scale business because of a reduction in the unified
influence, he said. It is important for the Russian government to carry out the best policy in those areas that it
can control, in order to achieve the set aims, he added.
Schiffer praised Russia's plans to increase oil exports, but said this would require oil pipeline expansion.
The course of tax reforms taken on by the Russian authorities is completely correct, he said.
social tax, Schiffer said. This will be an attempt to bring small and mid-scale business out of the shadow economy
and into the real sector, he said.
[RU ASIA EUROPE EEU EMRG AAA GDP ECI OIL CRU TRD JOB]
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A unified social tax cut should be accompanied by pension and social security reforms and this will lead to more
efficiency in the labor market, Schiffer said.
The Finance Ministry plans to further lower VAT would stimulate domestic consumption, the analyst said. It is a good
idea to lower the tax and the question is by how much it can go down, but still bring in enough for the necessary
expenditures, he said.
If there are losses from lowering VAT it is necessary to decide whether these will be covered or, if a strategic
decision is required to achieve a small surplus, will they be covered, for example, with borrowing or without and this
is a technical issue," he said.
[Interfax] |
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