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Kazakhstan’s Prime Minister Karim Massimov considers that preventive methods are a more effective way of fighting the shadow economy and corruption rather than punitive measures, Tengrinews reports citing IA Novosti-Kazakhstan.
Kazakhstan’s Prime Minister Karim Massimov considers that preventive methods are a more effective way of fighting the shadow economy and corruption rather than punitive measures, Tengrinews reports citing IA Novosti-Kazakhstan.
“If there is a hole in a wall, then it attracts a thief. There are two ways of addressing this situation. The first way is to assign an overseer to look after the hole, so when the thief tries to sneak in the overseer catches him. This is the punitive way. It is attractive to some particular agencies that need to justify their own existence and report on effectiveness of their work. The second way is to seal the hole, which will exclude the possibility of acts of corruption and reduce the share of the shadow economy," Massimov said at the joint session of Parliament on Friday, June 20, in Astana.
The Prime Minister said that the second way was preferable. He defined “sealing the hole” as “easing the procedures required to run the economy”.
Massimov spoke about agricultural sector as an example. Mechanisms of taxation and reporting are so complicated that it is easier for an agricultural producer to work in the shadow economy. Therefore, there is a need to simplify some of the procedures in order to provide the producers with incentives to work legally.
Massimov also talked about the moratorium declared by the Head of State on audits of small and medium businesses, which will last until the end of 2014. The PM stated that the moratorium was effective precisely because it made the procedures simpler and more transparent. He noted that the amount of taxes reaching the state budget has not decreased but stayed the same or even increased in some cases.
“We have a whole set of initiatives, including legislative ones, that we will approach you [the MPs] with in the Fall to change the situation cardinally,” Prime Minister promised.
By Dinara Urazova
