Government to ban car imports by proxy
The government does not seem to like the willingness of citizens to avoid paying taxes, even if they do it on legal grounds. Having analyzed the situation, the State Control Committee of Belarus is proposing that the Council of Ministers ban the import of vehicles using the power of attorney.
“The government needs money…People need the money, too…It is natural for people to avoid paying taxes,” says an anonymous man who makes money driving them from Europe and selling them in Belarus.
Under the current laws, every adult in Belarus is allowed to bring in from abroad and sell on favorable tax conditions one vehicle per year.
In order to avoid greater taxes when selling more cars, a dealer normally looks for a person who does not object to registering the vehicle with a proxy for a small but pleasant material bonus.
The two would then proceed to a notary and produce a letter of attorney, which makes the “interested citizen” an owner of the imported vehicle. In other words, he empowers to sell the imported car through a proxy.
How are the car dealers going to handle this situation? We have asked Aliaksej who works at the auto market in Malinauka near Minsk.
“If they are to ban physical entities from importing vehicles, it will be a problem to bring cars in. But if they still allow the physical entities to import, the men of straw will be open visas, travel and bring the cars…
All those services can be paid for reasonably. Only the buyer will lose in the end,” he said.
Naturally, the costs of visa for “an interested person” and transportation will be included into the price of the vehicle.
Meanwhile, the prime cost of a used auto is already burdened with the expenditures of the dealing driver. We have one of the dealers help in Aliaksej’s clculations.
“Let’s begin with the power of attorney. It will cost Br100,000 for a stranger. Visa costs and travel…One could save, of course, by traveling with a train.
But there are also those who have Germans simply sending them in here with truck tractors… Plus number plates (120-130 euros in Gemrnay), plus fuel…”
Aliaksej: “The major amount that goes to the budget is customs clearance duties…”
It is not hard to guess that if drivers are banned from working in favorable tax conditions and they simply stop their business, the government will not get even this money. But the dealers do not seem to be going to die out.
Dealer:” They will not ban proxies for relatives. People will continue traveling abroad. Today the Polish visa is $5. The same about the Lithuanian visa…You just open a visa and register the vehicle for someone else.”
The drivers who deal the cars privately are soon to be proposed to turn into private entrepreneurs and work in regular taxing environment. On the one hand, it would be fair as regards the already existing entrepreneurs who already deal the cars in Belarus.
Entrepreneurs pay the same customs duties as physical entities, but they bear additional costs for getting licenses and retail sale fees as well as a fixed tax when selling a vehicle. Physical dealers still operate in more favorable conditions.
Dealer: “They’d better add up some 100-200 euros in additions and let people continue bringing in the cars!”
But who in this country normally listens to physical entities? The government seems firm in its desire to squeeze them out from the auto market in this country.
But the auto-markets are not to be standing empty and idle. The vacuum will be occupied by private entrepreneurs and other legitimate traders.
But the prices for vehicles are already steadily growing, because of the cheap dollar to which the Belarusian currency in bound.
Owning a private vehicle seems to become less affordable for many of us.
Photo by www.alians-auto.ru
