Nothing new from SDSM

Zdravko Saveski

They will bring life to Macedonia, they would be a reform government, they would be different from VMRO-DPMNE. Not a few months have gone by and it turned out – the king was revealed. Where VMRO-DPMNE and DUI stopped, SDSM and DUI continued.

It is visible in multiple fields. Among other things, there are no changes in the economic field. During Nikola Gruevski’s reign with Macedonia, democracy was not the only thing that was crushed. It came to a great impoverishment of the people, a depletion that the statistical data did not show adequately. A great redistribution of wealth has also come to the benefit of the rich. While the common man could not make ends meet, the wealth of the oligarchs reached unprecedented proportions. And that the poor become poorer, and the rich richer is not a natural process, but a result of conscious government policies.

SDSM, before the election, acted as if it’s against it. The impoverished people believe this party. Those with a better insight into things saw that it was all nonsense, and that the party headed by a businessman would not work against the interests of large-scale capital. The first moves in power have indicated this, and after the first six months it was already quite clear that from a business party like SDSM it was completely unrealistic to expect that it would not act as such.

They continued VMRO-DPMNE’s tax policy. If in the meantime they were convinced that it was good, they should have let the public know. And if they think it was wrong, why didn’t they change it? They couldn’t change everything “overnight”? Aside from the fact that six months is not an “overnight” period. They already made changes in the laws that apply to taxation, but the privileges of the rich have not been touched! They extended the borrowing in damage of the future generations! They increased the oil excise! Why didn’t they write about this in the election program? Or, they used the old trick – before the elections we will act as if we are nice, and when we win, we will do whatever is suitable for us and the bosses behind us?

The tax policy of the SDSM government says a lot. It says that this is a party that defends the interests of the oligarchy, the capital, just like VMRO-DPMNE, and that, in this aspect, there is no change in the government. So far, one coalition party has been in power, now the other one is ruling. The people – will be manipulated and made poorer from the second government, just like the first.
1) Income tax. The profits of the bosses are largely dependent on this tax. It is not paid by the ordinary people, but only by the firms and those who own them. And with that money, a socially responsible government could reduce poverty. In order to leave more money to the bosses, VMRO-DPMNE in 2007 reduced the profit tax from 15 percent to 10 percent, that is, for a whole third. Although VMRO-DPMNE changed the rate of profit tax, SDSM reconciled with it and repeatedly emphasized that the new government will not change it. But they could, for instance, keep the 10 percent rate for small firms and introduce an additional 15 percent rate for big firms that make big profits. For the latter, the rate of profit tax will become the same as in the time before Gruevski enriched them additionally. But, no! SDSM too wants to enjoy the support of the big bosses.

2) The privileges of ultra-rich in terms of contributions from salary. VMRO-DPMNE also reduced the salary contributions. And, for cheap political points and additional income for the bosses, it has further exacerbated the situation with the pension system. In the given situation, probably SDSM could not immediately pay the contributions from the salary. The maximum that can be done at this moment is through subsidies to increase the contribution to pension and disability insurance. But if SDSM cannot be criticized for this, then they deserve the sharpest criticism for continuing the legal privilege of the ultra-rich, with which, unlike 99 percent of the citizens, they pay salary contributions on only a small part of their wages.
This was stated in SDSM’s election program: “We will abolish the maximum upper limit for payment of contributions to salary, in order to eliminate the regressive tax burden on wages. At the moment, due to the existence of the maximum upper limit for payment of salary contributions, to a citizen with a gross monthly salary of 600 thousand denars, the total contributions and tax amount to 17 percent of the gross salary, while a citizen with a minimum gross monthly salary 14.114 denars), the total contributions and tax amount to 32 percent of the gross salary. This is not fair! ”

It is not fair, but instead of abolishing, SDSM decided to make adjustments to the maximum upper limit. And manipulate with us. Instead of 12, the maximum limit is now 16 average salaries. Based on this privilege of the ultra-rich only the highest-paid director in 2016, only for one person’s salary, the budget was damaged by about 645,000 euros. With the maximum margin being slightly higher, the highest paid director will take 202.600 instead of 204.000 euros per month, and the state will reimburse 17.000 from the lost 645.000 euros. How much of this means changing the politics of VMRO-DPMNE, and how manipulative this is, you do the math.

3) Personal income tax. How much they announced that the flat tax is unjust and that they will return the progressive tax! What happened to this? They said they would hold a public debate whether to return the progressive tax or not. With voting for a particular party, citizens give support for its electoral program. Hence, what is disputed if they apply what they have promised? And why does this need a public debate, and about the excise of oil, not mentioned in the election program, should not? Take note of this. The already made changes to the Personal Income Tax Act and changed as many as 40 members in it. They introduced changes in the payment of taxes to the poorest farmers for which it is unclear whether they are in their favor or in their damage, but – we are debating about the return of progressive taxation. In fact, what they want is to get an excuse and not execute it.

As a reminder, before Gruevski introduced a flat tax (only six months after he came to power), there was a progressive tax with rates of 15, 18 and 24 percent. Gruevski reduced them to 10 percent. The “excess” money, as expected, did not end up with the workers, but in the pockets of the bosses. The SDSM’s proposal for a progressive tax is a compromise between the progressive tax that was abolished by the VMRO-DPMNE and the flat tax they imposed. And it predicts two instead of three, with the second rate being set at the height of the salary where the third rate was previously set. That is, if previously the salaries above 1,000 Euros are taxed with 24 percent, SDSM proposes that they be taxed at 18 percent.

I agree that SDSM’s proposal is not very good. Given the enormous concentration of wealth in the pockets of the richest 1 percent of the population, it is probably more effective to introduce three instead of two rates, up to 1,000 euros – 10 percent, from 1,000 to 1,500 euros – 15 percent and over 1,500 euros – from 20 to 25 percent. But, don’t worry. SDSM does not consider giving such proposals under a public debate. SDSM thinks of ways of getting support to continue Gruevski’s tax policy.

Of course, when we talk about greater taxation of the rich, it should be pointed out that this is not just a goal. That money should not be abused by the government, instead it should be used in the direction of increasing social justice. With those 645,000 euros that the state lost on the basis of privilege of the highest paid director, social financial assistance for 553 households of four people can be provided. But if they spend the money on “travel expenses”, then the greater taxation of the rich missed the point. Therefore, it must be simultaneously accompanied by a more subtle spending of budget money, something that the SDSM is obviously not ready to do.