Economist: Goods Will Begin to Disappear in Belarus, and Prices Will Rise Significantly

A course has been set for the further impoverishment of the country.

Small business is often called the backbone of the economy, but in Belarus, the number of small businesses continues to decline. The website Charter97.org asked economist Lev Margolin why the number of small entrepreneurs continues to decline in Belarus:

- In my opinion, there are two reasons. First, our government absolutely does not consider the small business, as you put it, to be the backbone of the economy. For it, it is rather the category of people who are very difficult to manage. It is one thing to manage collectives of large enterprises and another thing to manage independent and individual businesses, which employ 5-10 people. By the way, this is evidenced by the attempt to create trade union organizations at such enterprises in order to somehow manage through them.

Secondly, it is the absolute insecurity of individual entrepreneurs and small enterprises, because they do not have the same independent trade union organizations that many large enterprises have, and they are trying to protect workers in some way. There are also no capable associations that could, again, protect.

People are gradually disappointed with this way of doing business, because you invest your money, work, and, instead of gratitude, they can come, detain you, and imprison you. These are, in my opinion, two main reasons why small business is not developing in our country and why it will not develop in the near future.

- How would you assess the current situation with entrepreneurs in Belarus?

I have already said about the main aspect of the activity that they are absolutely not protected. Another point is the financial situation because loans are becoming completely unavailable. Entrepreneurs are not able to take such interest rates. Accordingly, it is probably difficult to develop without loans.

Another thing is constant talk that it is necessary to change the tax system for entrepreneurs, remove the single tax, a simplified system, and so on, that is, the situation is not the most favorable.

- The authorities want to raise a single tax on individual entrepreneurs and individuals who work without a sole proprietorship. How do you assess the innovations that the new Tax Code brings for entrepreneurs? What can they lead to?

- To an even greater reduction in the number of entrepreneurs. I fully admit that the flat tax may be underestimated somewhere in some specializations, but these are questions of fine-tuning. This needs to be studied in detail, we need to talk to business associations, and only then make any decisions.

- What consequences for the economy will an even greater reduction in the number of entrepreneurs lead to?

- To disastrous consequences. First, these are people who do not demand anything from the state. Secondly, these are the people who created jobs. If treated differently, they could create even more. Thirdly, the state cannot provide them with normal work. After all, if a person, relatively speaking, bakes pies, this does not mean that he can be given a broom.

- How can the problems of the small business affect the consumer and the rise in prices? What will happen to the assortment of goods available for Belarusians?

- I think that, of course, they can. You understand that the fact is that there are areas where entrepreneurs occupy a fairly large niche. In particular, these are retail trade, second-hand goods, which have gained popularity. Here, the point is not, as they say, that someone wants to buy such goods, no, the point is impoverishment. If the people who do this leave the market, then, of course, the situation for the state can improve. However, will it be better for the consumer? Obviously not, because the variety of goods will be less, and they will be more expensive.

- Taxes are also raised for individuals who earn money in the service sector - tutors, owners of agricultural estates, etc. What can this lead to?

- This can lead to further impoverishment of the people. I say that the issues of increasing the tax are issues of very fine-tuning, if something needs to be done, then only after careful study.

If a person is tutoring, he will probably continue to do so. However, if before he had, say, 1000 rubles after tax, now he will have 950 or 900 rubles left. I don't think he will give up the whole business, because he has no options, but his life will obviously become worse.

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