Experts commented on the adoption of laws in support of small and medium-sized businesses
The parliament adopted a law on business support during the quarantine period. Thus, bill No. 4429 provides for the provision of one-time financial assistance: – to employees and sole proprietors who have lost their salary or part of their income due to quarantine (UAH 8,000), – to business entities to pay hired workers in proportion to the reduction in working hours (up to UAH 8,000), – to individuals to reimburse the paid ERUs (in the amount of the average monthly amount over the last 10 months). It also provides for the extension of licenses for business entities for the sale of alcohol and the validity of permissive documents for the quarantine period and three months. Ukrainian experts shared with the readers of “Comments” why the deputies decided to support the president and how real such assistance is.
“Total fiscalization is not necessary” The representative of the Economic Expert Platform Oleg Getman recalls that last week the parliament adopted a number of projects initiated by the president. In particular, this is assistance to small businesses (who have suffered and will suffer from quarantine restrictions) and the postponement of the introduction of cash registers (cash registers) to 2022.
“Support for small businesses in the amount of 8,000 hryvnias is seen as expedient,” the economist notes. “A number of entrepreneurs and their employees have really suffered from the restrictions imposed by the Cabinet of Ministers. And they will also suffer losses from the restrictions that are planned for the catering and entertainment sector in early January. The decision on PPO is not optimal. The postponement of PPO is a postponement of the problem, not its solution. According to experts’ calculations, the total fiscalization of groups 2 and 3 of the simplified system is not economically feasible. It is harmful for society as a whole.”
According to Oleg Getman, total fiscalization should be replaced by fiscalization of exclusively risky payer categories, determined on the basis of the size of the retail space and product range. The bottom line is to focus control exclusively on large players who minimize taxes through pseudo-FOP.
“Also, the people’s deputies canceled an innovative mechanism – cashback for the consumer. From 2021 it was supposed to attract consumers to control the issuance of checks, which would significantly reduce the shadow share in trade. So last week, a number of positive and a number of negative changes were adopted,” he said. expert. – Unfortunately, the parliament combined the adoption of positive initiatives with populism. In addition, the agenda last week included extremely important projects – No. 3087d (on the establishment of the Bureau of Economic Security) and No. 4056 (on reducing the discretion of inspection bodies), they were not put to the vote … We hope that these are technical misunderstandings – and these projects, which are awaiting experts and all business associations, will be adopted by the end of 2020.”
“Small business has no margin of safety”
An economic expert, candidate of economic sciences Oleksandr Vovchenko has the impression that the measures to support small businesses that are now being introduced in Ukraine by the authorities are nothing more than eyewash.
“These measures can in no way be compared with the support that Western countries provide to their entrepreneurs,” the economist emphasizes. “For example, in the United States, small and medium-sized businesses are offered preferential loans for 30 years on average at 3%. In France, during a lockdown, help was 1500 – 2000 euros, in Germany – up to 9000 euros per employee. The lump sum of 8000 hryvnia offered by our authorities, exemption from the payment of ERUs, is a drop in the ocean, and will in no way affect the rescue of business or its support.”
Oleksandra Vovchenko notes that small businesses no longer have a margin of safety. At the same time, working capital is also needed, you need to pay monthly utility bills, rent, etc.
“It is worth noting that the government’s assistance is designed only for individuals-entrepreneurs of the first group, to whom there is also a whole list of requirements. But what about other entrepreneurs?” The expert asks. “I think that the authorities need to seriously approach this issue and take real measures on adequate support for small and medium-sized businesses.”
