EKIP– Expert Club for Economics and Politics A Different Opinion
After the summer break, the deputies returned to parliament, enthusiastic about interfering in our lives and picking our pockets. But those who voted for the parties in parliament should not frown - because they chose the authors of the reforms, the problem is that along with the dry, the harsh also burns.
A few important clarifications on what the people's representatives have concocted regarding our money and how to seize more of it through taxes:
- The possibility of additional taxation of up to 2% on the flat tax (which is currently 10%) in favor of municipalities is another attempt to fill the budget, which is then unclear how it will be spent. There is an additional burden on small and medium-sized businesses, as well as on the individual. At this level of wages, [1] as well as with such high indirect taxes, the policy of additional taxation of the individual will be detrimental to the economy. The effect of this will be that people will “vote with their feet” and change their address registration in order to pay lower or no taxes. The initial idea was to divide the tax into two, namely 8% for the state treasury and 2% for the municipal budget – this was more reasonable than the current possibility of additional taxation.
There is another point here: converting the tax rate into a "10+2" format will be an important precedent that will render meaningless and destroy one of the few major achievements of the transition - the introduction of the flat tax.
- Payments over 5,000 leva to be made by bank transfer, with the aim of thwarting suspicious payments “under the table”. Limiting cash payments is an idea that we have already considered. Naturally, this idea has a desirable effect on payment actions between individuals, and that is why from now on, goods and services over 5,000 leva will be paid up to 4,999 leva directly, the rest will either be disguised as a separate service or will be paid in another form. We can speculate whether the government’s hidden goal is not to put more money into the banking system and artificially increase trust in it. It may be that the state wants to monitor our every action – what and where we buy.
- To declare to the NRA whether goods worth more than 700 leva, purchased by companies that are registered for VAT, are used for official or personal needs. The argument of the Ministry of Finance is that the European Court of Justice has established such case law. We can see for ourselves that such argumentation is absolutely pro-forma and aims to blind people's eyes. Naturally, this will again be a blow to business, as it will be charged with filling out, calculating and submitting yet another declaration to the NRA. Moreover, the introduction of such a measure will further expand the state's ability to monitor the private sector, as well as to "intervene" against entrepreneurs inconvenient to the authorities in case of need.
Failure to comply with these instructions will result in the relevant companies not being entitled to recover their VAT. The methodology by which it will be calculated whether the use of the asset is personal or company has not yet been clarified and this is what makes this change dangerous. It is known that the NRA carries out inspections mainly on signals and thus nothing stops the law from being used to the detriment of inconvenient companies. Naturally, when laws are amended or forged, the native statesmen do not follow the words of Seneca, which state that the law should be short, but on the contrary - they additionally complicate it and make it in favor of certain individuals or companies.
There is a famous thought – “Don't steal! The state hates competition.” It is fully applicable in Bulgarian reality. Taxes are theft, and by participating in it and legitimizing it, we become accomplices.
[1] According to data from the National Statistical Institute, the average salary in Bulgaria for June 2015 ranges from 1,081 BGN in the Southwestern region (which includes Sofia) to 699 BGN in the North-Central region.
Taxes are theft, it's a very exaggerated statement, it's even a lie, and a separate topic is how taxpayers' money is spent, that is, the thefts are in/through/ the budget expenditures.
10% flat corporate tax and 5% for shareholders robs Bulgaria because the major taxpayers are foreign companies and the profit is exported (comment #1) - http://darikfinance.bg/novini/115933#comments
, and Boyko Borisov understood that 27 billion were drained, that is, if he understood it, then a large part of the economists who profess neoliberalism should have their diplomas shortened
Milton Friedman has industrial capitalism in mind when he talks about the free market, not financial capitalism, that is, financial capitalism requires strict regulations.
Friedrich Hayek doesn't even mention financial capitalism and he is right about industrial capitalism, not forgetting that worse than state monopolies are private ones.
Friedrich Hayek - there is no point in trying to change the opinion of the entire population, the Austrian economist claims, it is enough to change the beliefs of the elites. Hayek means journalists, university professors, public intellectuals, writers. After that, it is they who will become the people who, through their appearances, will convince society that there are no better ideas than those praising the market and privatization.
Friedrich Hayek believed that the involvement of state structures in the life of society should be minimized and that everything should be left to the "invisible hand of the market." But capitalism in the United States achieved its greatest successes from 1950 to 1970 because it had high taxes and regulations.