The MP of the Democratic Party of Moldova (PDM) Eugeniu Nichiforciuc is confident that the fiscal reform, by which a common income tax rate of 12% was introduced, will have a positive impact. In the talk show ”Issue of the day” on Canal2, Nichiforciuc said: “For the first time in the Republic of Moldova, the subsistence minimum will not be taxed as the personal exemption is raised from 11,000 lei to 24,000 lei a year. This is very important as those who pay higher income taxes will now see the difference remaining in their pockets.” According to the MP, this could motivate some of the citizens to return home from broad. “The effects will be felt immediately and this is very important for creating new jobs and for increasing salaries given that there is a shortage of staff in many areas and we will stimulate the people to remain and work in the country,” stated Eugen Nichiforciuc.
This is a nice perspective and let God be so! If the expectations of the ruling Democrats are so encouraging and positive, why are the reactions of the parliamentary and extraparliamentary oppositions and the expert community so negative? Only out of envy for the PDM’s accomplishments? Why are the reactions of the development partners negative too then? The answers to these questions differ depending on who gives them. The first reaction came from four parliamentary groups, of the right and of the left, which on July 26 left the assembly hall of Parliament. According to them, the procedure for examining the bills included in the agenda of the sitting was violated, especially the law on decisional transparency. In particular, the Communist group said the reformist, pre-electoral and populist package of laws hadn’t been published at least several hours before the siting where this was to be put to the vote and wasn’t known by the MPs. However, the four groups placed emphases differently. For example, the Socialist group expressed its dissatisfaction with the fact that the Democratic majority group copied a part of the ideas and bills that they have prompted since 2009. The Socialists’ indignation was caused by the populist character of the Democrats’ bill that would have introduced the zero tax rate on reinvested profit, not a common income tax rate if it had been aimed at stimulating businesses. The Liberal Party (PL) drew attention to the fact that the so-called fiscal reform only camouflages and diverts attention from the promotion of the law on voluntary declaration and fiscal stimulation, which revived the old idea of capital amnesty that enables to legalize the bringing back of the stolen US$1 billion to the country.
These are the circumstances in which the fiscal reform that was also promoted by Democratic MP Eugeniu Nichiforciuc was adopted. An ad hoc reform before the elections. It wasn’t announced, wasn’t consulted with anyone, with the trade unions or employers or with the development partners that keep Moldova afloat by the programs they implement. Namely in such a context should the negative reactions to the ad hoc reforms on the part of the representatives of the European Union, the U.S., the IMF, the WB and the Council of Europe’s anti-money laundering committee be perceived.
In fact, the best explanation of the ad hoc reform before the elections was provided by Parliament Speaker Andrian Candu, vice president of the PDM: it is the case for the government, as it did today, to come up with clear and concrete solutions for the people as the citizens, the country’s population are tired of only hearing about reforms and of bearing the burden of these reforms without seeing an immediate and direct benefit. Today we adopted several bills that will definitely have a direct and immediate effect, especially starting with October 1, if we speak about the fiscal reform (minute 7.16 -7.48). A day later, on July 28, 2108, the parliamentary elections were set for February 24, 2019. This way all things were placed to match the declared interests.
Is this a sample of electoral populism? The answer to this question is provided by a representative of the PDM, the head of the women’s organization Valentina Buliga, vice president of the party. This is how she described the electoral populism of the Party of Communists (PCRM) in 2001-2009: I want to note the populist and illegitimate methods (of the PCRM), applied to index the pensions, especially in the post-electoral period. A similar situation was created in the social assistance sector. We should only remember the large-scale programs, such as the SCERS and the “Moldovan Village” that were aimed at liquidating poverty and at orienting the assistance to the most vulnerable ones. ... I would like to invoke an argument that is not less important. The policy pursued by the previous government (PCRM) seriously affected the mentality of society, maintaining the flame of hope that the Soviet regime will be kept, supporting by any means the nostalgia for the period when the prices were in kopeks ... These ideas that were cultivated in the people’s minds created a dependent society that cannot cope with the economic realities... (from Valentina Buliga’s speech in the Parliament’s plenary sitting of February 11, 2011, which was applauded). How much exposing enthusiasm!
The things mentioned above can be used by anyone to compare the pre-electoral and populist actions and see why the PDM’s populist actions are better than those of the PCRM that were condemned. It is now certain that a better electoral score is what really matters for the PDM. What follows will be yet seen. As regards the development partners’ attitude, what will they have to do after the elections if not to help remedy the eventual problems caused by the ad hoc reforms of the PDM?
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