MINSK, 22 February (BelTA) – Belarus President Alexander Lukashenko is displeased with the government's proposals, which implementation may lead to an increase in retail prices in Belarus. The head of state made the relevant statement before hearing out a report on the tax and excise policy in 2016 on 22 February, BelTA has learned.
The suggested novelties include the removal of preferential VAT rates on roughly 35 food varieties starting with milk, meat and ending with baby food. The President stressed that the measures would inevitably lead to an increase in prices and it is unclear whether the measures would benefit the state budget. “The demand will drop, the trade turnover will follow. Which is actually happening right now. What dividends will the budget get? What billions are we going to save? None whatsoever! We will just offend people, will spit in their faces and they will turn away from the government. Do we need that?” said Alexander Lukashenko.
The President reminded about the previous instruction: rising prices should be compensated for by rising revenues of the nation. “What is our policy? Prices will rise. We will not avoid that. We are surrounded by countries where prices are higher. This is why we will have to adjust to them anyway. Otherwise, our products will be washed out. But in the past we stated that revenues of the nation have to be increased before prices are raised,” continued the head of state.
“Have the revenues of the nation gone up? I don't think so. But you are willing to raise prices,” Alexander Lukashenko criticized the proposal. Besides, the removal of preferential VAT rates may increase prices for kids, negatively affecting the socially vulnerable population strata.
