«Nashy Groshy» on the dynamics, taxes and future in the IT industry

Illustration: "Nashy Groshy" Telegram channel
5 mins

На русском языке: «Нашы грошы» о динамике, налогах и будущем в IT-индустрии

The telegram channel «Nashy Groshy» published a post in which it correlates statistical data with the real conditions for the work of IT in Belarus. Here is the post unchanged.

Recently, we told you why the IT industry is becoming an increasingly significant driver of the economy, despite the fact that the authorities, to put it mildly, dislike it. Recent evidence suggests that this driver has recently not only been used effectively, it is intensively «milked», only occasionally looking back at the consequences.

In 2021, taxes for IT increased — the income tax rate was raised from 9 to 13%, although initially the working conditions did not imply such changes. With this approach, representatives of the high-tech sphere can expect anything from the government, and this explains the curious dynamics.

On the one hand, it seems to be positive for both the IT sector and the budget. Tax revenues from the HTP to the budget are significant, just in the second quarter of this year — 200 million rubles (twice as much compared to the same period last year), the third quarter — 180 million.Traditionally, the second and fourth quarters of the year give large revenues.

Apparently, this is even more than the tax authorities expected. And this can spur them to further, even more active actions.

«Nashy Groshy» on the dynamics, taxes and future in the IT industry

Illustration: "Nashy Groshy" Telegram channel

The understanding that the state paid attention to the growth driver (and in our country this is not a positive sign at all), apparently, came to representatives of the IT sphere. This quickly affected some other indicators, and they are no longer so rosy.

First, the growth in the number of HTP residents has stopped. Last year, despite the pandemic and political developments, the number of residents rose from 734 in the first quarter to 962 in the fourth quarter — by almost a quarter. This year, in the first quarter, the number of residents was 1014, in the second it fell to 1012, by the third it grew to 1049. The total growth was 3.5%.

It’s clear why this is happening. Criminal cases, persecution of IT specialists, open rhetoric that they are «greedy», like bankers, and it is time to confront them, do not contribute to the desire to develop business in the country. The problem is that it is easier to roughly and primitively «press» bankers. And everything is much more complicated with IT specialists. They can raise taxes, but only as long as they tolerate it. When they stop it–  a month, and they’ve gone to other countries. And it’s often enough for them to do it virtually. Working and paying taxes in another country without being in it physically is now quite real.

Secondly, it can be seen that on average, tax revenue per IT organization decreased in the 3rd quarter compared to the second by 12%. Last year, the third quarter also sagged, but only by 9%. This means that, firstly, new residents are not large companies, and secondly, those that have been working in the country for a long time do not strongly seek to develop business here (or, most likely, develop it somewhere else).

Recently, a survey was conducted by the Belarus IT Companies Club, which very clearly shows that there is a lot of pessimism in the Belarusian IT sphere about the fate of the industry within the country. 78% of respondents have faced a shrinking market for technical specialists, and 80% of respondents believe that the conditions for IT business will worsen. Someone leaves, the influx of new personnel has weakened, business in the country simply will not be able to fully develop without a satisfied demand for specialists.

Will the government be smart enough to notice the alarm bells and change tactics by abandoning aggressive «milking»? It is difficult to imagine that in the current situation, someone will have the will to take such steps. The pressure will rather increase and lead to sad consequences. So far, this is not happening in full only because, apparently, among those close to the government, there are people who are trying to lobby the interests of IT. This is clear, for example, by what changes will be made to the Tax Code next year. In the previous draft, it was not supposed to maintain the «simplification» for individual entrepreneurs engaged in IT, but in the latest edition this preference was still preserved. Apparently, it was possible to convey that by taking away the «simplification» from freelancers, the state will lose much more than it gains.

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