The head of the Metals Employers Association Valentin Eșanu calls on the authorities in Moldova to intervene urgently to create equal conditions for the business entities operating on the left side and the right side of the Nistru. He said that currently, the companies of the Transnistrian region do not pay taxes into the state budget, use gas free and cheap electrical energy, while the entrepreneurs from the right side experience harsher conditions. Moreover, the authorities imposed a 12% tax rate on the collection of scrap metal and a cap of 10,000 lei on the purchase of metal by cash. These provisions should be annulled.
In a press briefing hosted by IPN, Valentin Eșanu said that the group of Vlad Plahotniuc (ex-leader of PDM, e.n.) continues to lobby for laws that will affect the national economy and will legalize smuggling. The regulations on the setting of criteria for excluding the waste status for copper, steel and iron and aluminum waste, glass shards and compost were to be discussed in the June 22 meeting of the Cabinet, but mysteriously disappeared from the Government’s website and it is clear why. This document was to stipulate measures to protect the environment and human health by preventing or reducing the negative effects that can be caused by the transfer of waste. Also, the document was to stipulate the procedures and control rules for the transfer of waste according to a number of criteria.
On the other hand, the regulations exclude the state’s instruments for controlling the transfer of waste. “The notion of “waste” that the responsible state authorities, namely the Ministry of Environment, intend to modify into “raw material” will exclude any control regime and will favor smuggling on the import/export of scrap metal. Who will stand to gain? In Moldova, there is no other plant for processing scrap metal than the Rybnitsa steel works. The natural question is, who are the beneficiaries? Not the shrewd guys of the regime of Plahotniuc, who benefitted from billions of lei by this scheme and who seem to be working in collusion with some from the current government?” asked Valentin Eșanu.
He noted that as a result of this amendment, the Moldovan steel works in Rybnitsa is stripped of the obligation to hold an environmental permit for waste management on the export of scrap metal, while the state will fully lose control over this plant. The Rybnitsa steel works will therefore not need the permission of the Moldovan authorities to import raw material or scrap metal in fact. The works is now under the ban on the export of metal imposed by Ukraine in 2014 following the annexation of Crimea. By modifying the word “waste” into “raw material”, any business entity will be able to import waste metal into the Transnistrian region.
The head of the Metals Employers Association criticized a number of legal provisions that are detrimental to business entities that work honestly and pay taxes into the state budget, while other companies do not need to pay these taxes or commit tax evasion. The companies operating on the metals market, which do not pay the tax rate of 12% to the state, actually steal twice –from the citizens and from the state budget. “I note that the 12% tax rate on the collection of scrap metal is not paid in the Transnistrian region and there are no limits on sums of 10,000 lei on card payments. This way, the persons from the sides of the Nistru are not treaties equally and the Transnistrian companies are favored,” stated Valentin Eșanu.
He called on the Government to annul the law on the imposition of the 12% tax rate on the collection of scrap metal and the cap of 10,000 lei for transactions in cash and to annul the income tax of enterprises and include a common tax rate of 3% of the cost of the value of merchandise that is sold for being recycled or is exported.
Valentin Eșanu also requests the authorities to include a VAT rate of 20% on the purchase of scarp metal on Moldova’s territory and on the import of waste. He noted he is ready to take part in a working group that would include representatives of the Government and the parliamentary commission on economy, budget and finance so as to formulate solutions for adjusting the legislation to prevent money laundering, tax evasion, etc.
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