Ukrainian Businessmen Protest Proposed Tax Hikes

KIEV, Ukraine -- Kiev - Thousands of Ukrainian small businessmen and their supporters protested in a large rally Tuesday against tax hikes planned by the country's corporate-friendly government.

People attend a protest outside the parliament building in Kiev, November 16, 2010. Several thousand Ukrainian taxpayers, many of them running small businesses, protested outside parliament on Tuesday, urging deputies to vote down a proposed tax code that they say will hurt their livelihood.

Some 10,000 demonstrators gathered next to the national legislature building in Kiev, where they listened to anti-government speeches and shouted slogans against a tax reform package backed by President Viktor Yanukovych.

'Down with the fat cats!' demonstrators chanted. Some carried banners saying, 'Don't destroy small business!' and 'Keep your fingers out of pockets where you never put anything!'

Ukrainian Prime Minister Mykola Azarov told the legislature Tuesday that the proposed tax changes were necessary to equalize the tax burden, to help balance the national budget and to guard the national pension fund against bankruptcy.

The reforms will also reduce taxes on profits 'to Europe's lowest levels' and end a national epidemic of tax evasion, Azarov said in televised remarks.

But the protesters say the reduced taxes on profits will be a boon to big businesses - which are more likely to enjoy profits - while other measures to seal loopholes and boost other tax rates will hurt the less profitable smaller businesses.

Those critics say the reforms reflect the government policy of protecting its big-business supporters.

The demonstration was noisy but peaceful. Marchers - many of whom travelled to Kiev from outlying provinces - threw toilet paper, small change and rotten fruit across security barriers at the parliament building.

There had been no arrests as of midday, the Interfax news agency reported.

In the morning, members of parliament voted on more than two dozen amendments to tax law, many aimed at increasing government income by raising amounts collected from small and medium-sized business.

A final version of the changes has not been approved.

Rally speakers denounced Azarov's proposals, saying the government plan would double taxes on small and medium-business and enforce payments by all businesses into the national pension fund, destroying the country's middle class.

'(The Yanukovych-Azarov tax reform bill) is intended to be a government weapon against small and middle-sized business, and to protect big business,' said Mykola Tomenko, an opposition leader, according to a report from the Unian news agency.

Parliamentary deputies loyal to Yanukovych's Party of Regions control a solid majority in Ukraine's legislature.

Regions, which is closely allied with leading business magnates, supports state intervention to promote: the growth of industry; tight fiscal policy; slow market reforms; and close relations with Ukraine's giant northern neighbour Russia.

Regions' opponents support close relations between Ukraine and Europe, rapid market reforms and increased government oversight of big business.

Source: DPA

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