ENTREPRENEURS PLACED UNDER GOVERNMENT CONTROL In terms of the number of roadblocks thrown up the state racket leads

The experts of International Financial Corporation will soon announce the results of the poll, involving 200 representatives of small and medium business from Dnipropetrovsk, Lviv, Kharkiv, Vinnytsia. Results of the poll confirm the fact that there is no tendency for business activity to increase. 900 small new and medium enterprises were set up in Ukraine last year. In all there are 100,500 of them in Ukraine, compared to 2.6 million in the Great Britain. These businesses employ only 2.1 million people.

Tax legislation is still the main leader in creating obstacles for business development and improvement. 95% of the entrepreneurs polled put high taxes in first place, 82% named huge amount of different taxes and fees, 70% said taxation legislation changes too quickly, and 44% of managers confessed they have to hide 31-50% of their income from tax inspectors. The rackets were well down the list ranking only twelfth by businessmen in their scale of problems and affecting only 5% of operating enterprises. As expected, the weak points in business development are low consumer demand and debts: people lack money and clients do not want to pay.

Despite numerous government announcements regarding economic freedom, businessmen note constant pressure from oversight organs. For instance, it turned out that private enterprise might be checked by 25 state organizations, representatives of which average 78 unofficial visits a year. It takes two out of five working days to deal with them, which totals a nice sum of Hr 4200 a year. It turns out that $1000 is essential to start your own business: to register an enterprise and to receive a license.

In short, while the government tries to save the domestic manufacturer, the tax administration and low demand prevent him from growing and improving. Of course, the situation is different in the shadow economy. And all the same, business expects to survive until the state reduces the army of bureaucrats along with tax rates. The income side of the state budget also is waiting for that.