The government refuses to raise the minimum wage from 1 January 2017

The government on Thursday, 20 October, to discuss the question of increasing the minimum wage (SMIC) in 2017, the materials of the Cabinet of Ministers, which examined the day before. The bill requires the increase in the minimum wage is not Jan 1 as it was the last four years, and from 1 July 2017, and only 5.2% from the current 7.5 million to 7.89 million RUB Earlier this week, the initiative in such form approved by the governmental Commission on legislative activities, said two participants of the meeting held on 17 October. The agenda of the meeting on 20 October, published on the government website, the bill was not.

Before the government can reach even more cautious option: the source in the Federation of independent trade unions of Russia (FNPR; member of the trilateral Commission) confirmed that the government has prepared a bill to increase the minimum wage, but said that the government plans to increase the minimum wage from 1 July to 7800 RUB. the Difference — only 90 rubles, but the minimum wage is in this case reduced by 5.2%, and only 4% — in line with the budgeted forecast of inflation. Raising the minimum wage from 1 July 2017 4% — the proposal put to the government, confirms a source in the government.

The social block of the government previously expected a much larger increase in the minimum wage in 2017: Deputy Prime Minister Olga Golodets in September announced a growth to 8.8 thousand rubles (+17% to the current), and 1 January. About the differences between the social and the financial-economic bloc of the government about a much smaller increase in the minimum wage is not reported, told the meeting of the state Commission. The Ministry of labour aims to increase the minimum wage to a living wage by 2020, but while the minimum wage is only 70% of the subsistence minimum of able-bodied population, and the goal is to equalize them was set in 2002 by the Labour code.

The minimum wage is important because it determines the minimum monthly wage in the country, the size of temporary disablement allowances, on pregnancy and childbirth. Golodets was estimated that 4.8 million of Russians working with the salary at the level of the minimum wage — in her words, is “a lot”. Many small firms minimise personal income tax and insurance contributions, paying official wages of the minimum wage. But the magnitude of the minimum wage also depends on the size of insurance contributions for individual entrepreneurs for themselves in the Pension Fund and the mandatory medical insurance Fund. If the minimum wage had increased as promised added the insurance payments to SP would increase immediately by 42%. The fact that the magnitude of the contribution to PIS was determined based on the Federal minimum wage on 1 January, which this year was 6204 RUB, and sosblog wanted to bring it up to 8800 RUB.

Starting 1 July 2016, the minimum wage was raised by about 21% and now amounts to 7,500 rubles, but entrepreneurs continue to pay the old tariff. The decision to delay another increase in the minimum wage until the middle of next year will mean that the premiums EP out January 1, will increase, but not as much as I could. The payment PI to extra-budgetary funds in 2017 will amount to almost 28 thousand rbl. (against 23,2 thousand this year).

Ministry of economic development proposes in order to “prevent the deterioration of the self-employed category of taxpayers, including individual entrepreneurs” to freeze the amount of insurance premiums in 2017-2018 at the level of 2016 (that is, of 23.15 thousand rubles), follows from the bill that the Agency posted on October 17 Small entrepreneurs are very sensitive to any changes in government regulation, and “increase the financial burden is expected to entail a reduction in the number of registered individual entrepreneurs, their care in the informal sector, or registering as unemployed,” says the Ministry.