Economist Monin Proposes Small Business Reform: End 'No Activity' Reporting and Limit Account Freezes

An Alternative Reform Plan for Small Businesses

According to ХВИЛЯ: Economist Danylo Monin has presented an alternative reform plan for small businesses during an interview with political analyst Yuriy Romanenko. The core proposals of this reform are to eliminate the requirement for businesses with no activity to file reports and to restrict the tax authority's power to block accounts only to cases involving genuine, unpaid tax debts.

Monin pointed out that entrepreneurs are currently forced to file meaningless 'empty' reports or face fines. He emphasized that

"the tax service already sees account activity through the banks. If there has been no movement, why demand a piece of paper? This only stresses people and the tax officials who have to input this data into the system,"

he said. The economist also argued for the elimination of all account blockades except for cases of unpaid tax debt, labeling everything else as 'corrupt extortion.'

Key Reform Proposals

Monin stressed that the primary communication channel between entrepreneurs and tax inspectors should be an electronic cabinet, where every official action is logged. This, in his view, would help distance officials from an entrepreneur's finances. The reform plan contains two main points:

• Allow businesses to forgo filing reports if they are not conducting any activity;
• Strip the tax service of the power to block accounts, except when there is a real, unpaid tax debt.

Danylo Monin's proposals could significantly simplify administration for small businesses by reducing bureaucratic burdens and corruption risks. Eliminating the reporting obligation for inactive enterprises might stimulate their activity and lessen the workload for the tax service. Such reforms are often seen as crucial for fostering entrepreneurship in emerging economies. If implemented, these initiatives could improve the country's business climate and increase entrepreneurs' trust in state institutions.

As discussions around tax reform intensify, it's crucial to consider the potential risks to small businesses. Recent insights from another economist highlight how these changes may jeopardize the stability of the small business tax group. For a deeper understanding of these challenges and their implications, read more about the warning regarding the dangers posed by the tax reform.