Cash Amnesty Offer Will Depend on Trust
Cash Amnesty Offer Will Depend on Trust
A proposed amnesty designed to eliminate the shadow economy could fail unless those who own up to their wealth are given cast-iron guarantees that they not be persecuted in the future, according to NBCentralAsia commentators.
A draft plan to offer an amnesty for undeclared income and assets was presented to an October 11 cabinet meeting by First Deputy Prime Minister Daniyar Usenov. The plan would make it possible to legalise previously undeclared cash held in any currency, real estate and other property, securities, and incomes received from any kind of economic activity and not declared earlier.
The amnesty period would last for 90 days and would be open to all citizens of Kyrgyzstan.
In June 2005, Kurmanbek Bakiev, who was acting president at the time, announced that the government planned three major measures to boost the real economy in the short term: writing off old debts left over from the Nineties, a tax amnesty, and legalising shadow-economy incomes.
NBCentralAsia’s economic experts predict that the amnesty will bring large amounts of money back into circulation, meaning more tax revenue for the government budget. It will also boost the banking sector, since businessmen and ordinary people will begin saving more money in the banks.
The experts say the more shadow-economy money is amnestied, the better it will be for the state.
Kyrgyz businessmen are in favour of the scheme, arguing that it makes economic sense. But they caution that for the campaign is to succeed, it will require a high degree of public confidence in the government and the institutions of state. In their view, the country remains politically unstable and businessmen are coming under pressure from state institutions, so not many owners of substantial shadow-economy capital are likely to go for the amnesty.
NBCentralAsia commentators believe that the state needs to provide solid safeguards to ensure that people who legalise their capital and property are not victimised once the campaign is over. They recommend that clearly-defined, transparent mechanisms should be developed that take account of the public mistrust in government initiatives of this kind. There is also a need for a PR campaign to persuade businessmen that declaring income and assets is good for them as well as for the state.
Omurbek Abdrahmanov, a businessman and head of the Union of Democratic Forces party does not support the scheme. He says many government officials may be interested in an amnesty if they themselves have made a fortune through corruption.
Other commentators highlighted the risk the once money and property have been declared and are part of the legal economy, they may draw unwelcome attention from law-enforcement agencies and criminal groups.
(News Briefing Central Asia draws comment and analysis from a broad range of political observers across the region.)
A draft plan to offer an amnesty for undeclared income and assets was presented to an October 11 cabinet meeting by First Deputy Prime Minister Daniyar Usenov. The plan would make it possible to legalise previously undeclared cash held in any currency, real estate and other property, securities, and incomes received from any kind of economic activity and not declared earlier.
The amnesty period would last for 90 days and would be open to all citizens of Kyrgyzstan.
In June 2005, Kurmanbek Bakiev, who was acting president at the time, announced that the government planned three major measures to boost the real economy in the short term: writing off old debts left over from the Nineties, a tax amnesty, and legalising shadow-economy incomes.
NBCentralAsia’s economic experts predict that the amnesty will bring large amounts of money back into circulation, meaning more tax revenue for the government budget. It will also boost the banking sector, since businessmen and ordinary people will begin saving more money in the banks.
The experts say the more shadow-economy money is amnestied, the better it will be for the state.
Kyrgyz businessmen are in favour of the scheme, arguing that it makes economic sense. But they caution that for the campaign is to succeed, it will require a high degree of public confidence in the government and the institutions of state. In their view, the country remains politically unstable and businessmen are coming under pressure from state institutions, so not many owners of substantial shadow-economy capital are likely to go for the amnesty.
NBCentralAsia commentators believe that the state needs to provide solid safeguards to ensure that people who legalise their capital and property are not victimised once the campaign is over. They recommend that clearly-defined, transparent mechanisms should be developed that take account of the public mistrust in government initiatives of this kind. There is also a need for a PR campaign to persuade businessmen that declaring income and assets is good for them as well as for the state.
Omurbek Abdrahmanov, a businessman and head of the Union of Democratic Forces party does not support the scheme. He says many government officials may be interested in an amnesty if they themselves have made a fortune through corruption.
Other commentators highlighted the risk the once money and property have been declared and are part of the legal economy, they may draw unwelcome attention from law-enforcement agencies and criminal groups.
(News Briefing Central Asia draws comment and analysis from a broad range of political observers across the region.)
