In former USSR the tax system obliged single and childless citizens to pay additional taxes. And now MPs want to "resurrect" the small-family tax in Ukraine.

MPs from the Party of Regions (Yaroslav Sukhoy) and Our Ukraine (Kateryna Lukyanova) propose to introduce differentiated rates of income tax for citizens over 30 years old depending on the number of children they have.

According to the draft bill, taxpayers over 30 years old without children will have to pay 17% of the income tax base despite the total sum of received income.

If a taxpayer has three or four children, the youngest of who has reached the age of three years, the tax rate is 10% of the income tax base. And if a taxpayer has five and more children, the youngest of who has reached the age of three years, the tax rate will be reduced to 5%.

Among the exceptions there are cases when a taxpayer is a disabled of the I, II and III groups, when a taxpayer is deprived of parental rights, when a taxpayer does not pay alimony in accordance with the procedure established by law or when a taxpayer refuses additional expenses for a child in accordance with article 185 of the Family Code of Ukraine.

Under current legislation the income tax rate for private persons is 15%, and if the income of a private person exceeds the amount of ten minimal wages the tax rate is 17%.

ForUm decided to ask politicians and experts on expediency of introduction of such a law.

Evgen Tsarkov, MP of the Communist party, deputy head of the parliamentary committee on finances, banking activity and tax policy:

- The given draft bill proves once again that before elections politicians use socialistic initiatives regarding the social protection. In this case they took the norm of former USSR, but in a rather crooked variant. In USSR it was a real motive to increase birthrate, supported by provision of housing. Besides, the Soviet system had a respite till a taxpayer gets his first job.

Now they completely twisted the approach. The majority of modern young families are low-income; they have problems with housing and employment, and in addition they will be forced to pay more taxes. Instead the authorities must cure the systemic problems, which impede the people to have full families. This idea is flawed and does not have social grounding.

Second point is the question of administration of the very tax. Do we have to create an institute of tax inspectors on gender policy? Thirdly: what if a person is sterile? Does he or she have to take a certificate about sterility? This is humiliating.

The fourth: our society has a problem - high rate of divorces among young families. According to the proposed draft bill, if a divorced person with a child gets married for the second time but does not have other children, he or she still falls within the scope of this law.

The fifth: according to the draft bill the tax will be applied to all citizens without children over 30 years and older. So what, if you never create a family, you will have to pay till the end of your days?

Authors of the draft bill could not answer these questions. It is obvious that neither our committee not the parliament will support this complete idiocy.

I want to propose to change the mechanism: let the state pay the interest rates for mortgage taken by young families at the age of 18-30, so that the families themselves will have to pay only the principle. In this case the state will have a right to demand children from the families. But when the state knows the problem, but instead of solving it burdens the young families even more I consider it an idiocy.

Ludmina Cherenko, head of the department on living standards research of the Institute of demography and social research:

- The adoption of the draft bill will bring additional money to the budget, and the intention to introduce this law is understandable. There are unbiased grounds to introduce this law, as it will help to distribute incomes of childless families in favor of those with children.

There is a certain sense in all this if the money from the new law will be aimed at full-fledged development of children. But the question is whether this money will ever reach the children.

But, of course it is additional burden for working people. It turns out to be an endless circle: risk of poverty for families with children is high due to low salaries, and young specialists can hardly keep one child. And according to the proposed scheme the financial situation of young families, which cannot afford to have children now, will be more complicated.  

Yaroslav Sukhoy, MP from the Party of Regions and co-author of the draft bill, deputy head of the parliamentary committee on social policy and labour:

- The adoption of the draft bill will bring additional one billion hryvnias to the budget annually. This money will be directed to the treatment of sick children. It is impossible to be quiet and indifferent to children diseases. We did not have such terrifying diagnoses in the past. Parents are desperate, and Health Ministry does not have such money to send a child for treatment abroad.

As for the influence of this law on the social situation, I want to note that if a taxpayer has three or four children, the tax rate will be 10%, and if five and more children the tax rate will be reduced to 5%, while citizens without children will pay 17%, which is only 2% more comparing to the current tax base, and there is nothing scary in it.

If after 30 years you still do not have children we will give you a tutorial piece of advise how to make them (smiling- ed.) .

Volodymyr Paniotto, sociologist, Ph.D., director general of the Kyiv international institute of sociology:

- Such additional taxes will not stimulate Ukrainians to have children. Even considerable maternity grants could not do it. It turned out that these state grants did not make the population to procreate more children, but just made families, which already planned to have children, to do it earlier.

And if maternity grants did not help to stimulate the birthrate in Ukraine, the new taxes would hardly be of help. 

Iryna Bekeshkina, sociologist, head of the "Democratic initiatives" fund:

- It's not Ukraine, who wants to adopt this norm, but certain people, just to increase budget revenues, and they openly declare this. I remember such norm in USSR, but it concerned only single men.

What do I think about this norm? It's absurdity. It's not going to stimulate Ukrainians to procreate children, but will cause strong irritation among the population. There are many reasons why citizens do not have children after the age of 30. One cannot do this due to poor health. Others simply cannot afford children due to poor financial situation. How can you tax people for this?

Apart from good salaries, young families also need housing. Instead of reducing interest rates for mortgage and giving a possibility to live better, certain MPs want to take people's money they do not have. Is it normal?

Anyway, I think this draft bill will not be adopted before the elections.

Stepan Gavrish, former deputy secretary of the National Security and Defense Council:

- Introduction of the small-family tax is a return to the Soviet past.

For today Ukraine has the most complicated and over-regulated tax system in the world, while Russia, for example, has only 10 kinds of taxes.

In fact, the small-family tax is a discriminating tax, with the help of which it is impossible to improve the demographic situation.

Roman Zabzalyuk, MP:
- Before introducing the small-family tax, it is needed to revise the level of salaries, pensions and financial assistance for militaries and law enforcement officials.

When the demographic situation in Ukraine leaves much to be desired, I don't think the introduction of this law will somehow improve it.

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