Cracking down on the shadow economy has become a key goal for the Kremlin. Before the VAT rise took effect, Putin warned the new rules must not push firms into the shadows and called for a “radical reduction in illegal employment”.<\/p>\n
“One arm of the government is trying to squeeze as much money as possible out of people through higher taxes, fines and other charges,” Alexander Kolyandr, a non-resident senior fellow at the Center for European Policy Analysis, told the BBC.<\/p>\n
“But another, in trying to counter so-called terrorist threats, is undermining that strategy by making it harder to collect tax,” he said, referring to the mobile internet shutdowns.<\/p>\n
The Soviet-era instinct to keep money “under the mattress” is making a comeback despite double-digit returns on bank deposits, which have been kept high as the central bank battles stubborn, war-fuelled inflation. <\/p>\n
A 100,000-rouble (\u00a3950; $1,280) one-year fixed-term deposit at Sberbank, Russia’s largest lender, currently pays 10% interest.<\/p>\n
Even so, central bank data showed Russians withdrew 550bn roubles from bank accounts in May, including 200bn roubles from fixed-term deposits.<\/p>\n
Anton, a copywriter living in Moscow, said a vendor at a vinyl shop offered him a discount for paying in cash. “He was upfront about the reason, higher taxes,” he told the BBC.<\/p>\n
When mobile internet shutdowns intensified during heightened security around Russia’s Victory Day celebrations in May, he said he saw people struggling to withdraw money to spend at a flower market in central Moscow.<\/p>\n
“There was a woman going from one ATM to another, looking for one that still had banknotes.”<\/p>\n","protected":false},"excerpt":{"rendered":"Cracking down on the shadow economy has become a key goal for the Kremlin. Before the VAT rise…\n","protected":false},"author":2,"featured_media":699282,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2],"tags":[49,50,51,47,52,48],"class_list":["post-699281","post","type-post","status-publish","format-standard","has-post-thumbnail","category-headlines","tag-headlines","tag-news","tag-top-news","tag-top-stories","tag-topnews","tag-topstories"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/699281","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/comments?post=699281"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/699281\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media\/699282"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media?parent=699281"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/categories?post=699281"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/tags?post=699281"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}