Siarhei Balykin: Small business will have to become shady

The only way for the individual entrepreneurs to survive in Belarus is to get united into shopping pools; however, because of mentality of individual entrepreneurs this scenario is hardly possible.

After the president decree No. 222 was signed on May 16, businessmen are continually expressing their discontent about it. In their opinion, the new decree can become the last straw that would finally crush entrepreneurs. Let us recall that starting from July 1 individual entrepreneurs, i.e. those who are paying single tax, are requested to have the accompanying forms to the goods from the countries of the Customs Union.

Siarhei Balykin, the head of the Association of Small and Medium Business commented upon the consequences of the president decree No. 222 in the interview with the EuroBelarus Information Service.

- What is so terrible about the accompanying forms for the goods that the individual entrepreneurs will have to present starting from July 1?

- There are several threats.

The accompanying forms to goods from the countries of the Customs Union don’t even exist. Individual entrepreneurs purchase goods at all kinds of merchandise markets in the countries of the Customs Union. If the goods are illegal, naturally, there are no documents for them; but even if they are fully legal, the vendors won’t agree to costly bureaucratic procedures to provide documents for small parcels that the individual entrepreneurs are purchasing.

- There are 120 hundred individual entrepreneurs in Belarus, who have to earn their own living and provide their families. What is the way out for them?

- Individual entrepreneurs will be tempted to buy unlicensed documents for goods, the more so that it’s not a problem in Russia. But if they do so, they will feel the power of Belarusan fiscal authorities: it is very simple to find out that these documents are illegal, while the sanctions will be huge.

And if individual entrepreneurs try to sell legal goods with all the documents, bills of lading and certificates they will go broke. Such goods are more expensive, and because of small volume they won’t be able to compete with bigger competitors, distribution networks in the first place.

The only way to survive is to unite individual entrepreneurs into shopping pools or cooperatives; however, because of the mentality of individual entrepreneurs this scenario is hardly possible.

- Does it mean that the presidential decree will be a trouble for individual entrepreneurs?

- In fact, some individual entrepreneurs might be happy about the innovation: they are now allowed to hire three employees no matter whether they are related with them or not. For service industries and public catering this innovation is useful. The thing is that in these spheres taxation of individual entrepreneurs and legal persons is basically the same. That is why those who would like to open such business have already opened it, and there is no use to wait that things will develop there.

Not all who want can struggle their way through in this sphere; the state closely watches those who want to open their business in the service industries or public catering, which certainly doesn’t promote the development of small business.

- It looks like a vicious circle. So what we are to do in this situation?

- Small business is to undergo serious hardships and will, in fact, have to become a shady business. Entrepreneurs will have to purchase documents for some part of their goods, possibly illegal ones, and sell some part of their goods illegally. And dreadfully wait for inspections of tax authorities.

Individual entrepreneurs are losing their clients, who gradually go to huge distribution networks. Survival of individual entrepreneurs is the matter of competition.

- But who is responsible for putting entrepreneurs in this situation?

- It looks like individual entrepreneurs were used first and they were betrayed afterwards, both by the authorities as well as by opposition leaders and leaders of entrepreneurs.

The authorities were trying to buy off individual entrepreneurs by introducing single tax and degenerating lower middle class to a level of market traders.

Those close to power made a fortune at the expense of individual entrepreneurs.

Meanwhile, opposition with leaders of entrepreneurs has openly been using entrepreneurs for resolving their own political goals, for self-promotion, as well as cynically used reports from demonstrations of entrepreneurs in reports to their grants.

And nobody from the so-called “protectors of individual entrepreneurs” offered any competent ways to defend the interests of entrepreneurs; everything came down to loud emotional and rather silly statements, illiterate both politically and judicially.

The results are obvious.