18.02.08

Citizens and companies must be freed from taxes on education, medical insurance, and pension accruals. Prime Minister Viktor Zubkov gave this task to his subordinates Thursday, February 14. Of course, any Russian currently paying for treatment or education has the right to tax deductions. Debates regarding pension accruals are old news, but what the prime minister has to say sounds truly revolutionary.

The prime minister's enthusiasm for this measure can be reduced to one reason: president Vladimir Putin has charged him with finding an innovative path to develop the economy. How can this be accomplished? Zubkov is certain it requires an investment in human capital. "Only educated and healthy individuals will be able to solve bigger-picture issues," he assured the Cabinet yesterday. In his opinion, taxes should be used as an incentive to citizens – first of all by giving tax breaks to citizens and companies who pay for education, medical insurance, pension accruals, etc. He has told concerned departments to have proposals ready within the month.

Currently, income tax is refunded for expenses on education and medical treatment, but there is a restriction on the sum. The plan would likely affect changes in the maximum refundable total.

Companies can also expect changes. Right now companies can avoid profit tax only for very specific expenditures, such as employee training. If money will also be refunded for education fees, companies will probably be more likely to aid in the "cultivation" of their employees.

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