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The Real Russia. Today. Russia to raise pension ages and the VAT, as FIFA World Cup fever sets in

Meduza
11:34, 14 june 2018

Thursday, June 14, 2018

  • Russia to raise its pension age for the first time in modern history
  • Russia to hike its VAT by two percent
  • The Interior Ministry has instructed police departments not to report “bad news” during the FIFA World Cup
  • Serial sexual harasser Leonid Slutsky gives an enraging interview
  • Putin fires his hawkish Internet adviser
  • Without primaries, the democratic opposition is primed for an internal rivalry in the Moscow mayoral race
  • Russia's Teremok fast food chain gives up on the U.S. market, citing geopolitical hostility
  • Moscow police fail to break up a theater performance dedicated to a jailed human rights activist
  • Kaspersky Lab breaks off work with European law enforcement agencies
  • Alexey Navalny goes free from jail after a month
  • The Russian Red Cross has finished paying off compensation to victims' families in the Kemerovo fire

A couple of well-timed announcements

🧓 Raising Russia's pension age

On the first day of the FIFA World Cup, Prime Minister Dmitry Medvedev has unveiled the government’s plan to bump up Russia’s pension age. The reforms would take effect gradually, raising the retirement age for men from 60 to 65 by 2028 and from 55 to 63 for women by 2034. The reforms would start as soon as next year.

Russians who have already reached retirement age and started collecting their pensions wouldn’t be affected by these reforms. The government says it will preserve early retirement benefits for men with 45 years of work experience and women with 40 years of work experience, who can retire two years earlier than the new pension ages.

If you work in Russia’s Far North, the sting of the pension reforms will be five years less: the retirement ages there will only rise to 58 for women and 60 for men.

📈 Raising Russia's VAT

The government’s World Cup news dump didn’t end with pension reform: Medvedev also announced that Russia will raise the Value Added Tax from 18 percent to 20 percent, though existing VAT benefits on foods, children’s goods, and medical supplies will remain untouched, to ensure that “the burden doesn’t fall on [ordinary] people,” the prime minister said.

The higher VAT is expected to raise roughly 2 trillion rubles ($32.2 billion) over the next six years. In May, Finance Minister Anton Siluanov said Russia wouldn’t raise taxes in the next six years, but he did promise a “tax adjustment.”

Medvedev also announced a transition to “the final stage” of Russia’s tax reforms in the oil and gas industry, saying that the government will abandon export duties in favor of higher taxes on mining operations. The process is expected to take six years, beginning next year, and the government reportedly plans to raise 1.6 trillion rubles ($25.7 billion) in this policy shift.

What will Moscow do with all this cash? In Vladimir Putin’s May 2018 executive orders, he instructed the Russian government to take steps to increase the country’s life expectancy and reduce poverty. Federal officials reportedly plan to spend at least 8 trillion rubles ($128.7 billion) on these policy goals.

It's a good news week 🤥

Russia’s Interior Ministry has apparently instructed regional police departments not to report any “bad news” while the country hosts the FIFA World Cup (from early June until late July). Sources in the ministry's regional press offices confirmed the rumors to the website Mediazona, saying police have been issued “special orders” to focus on prevented crimes.

Reviewing the websites of all regional Interior Ministry offices, Mediazona verified that officials have reported vastly fewer cases of detentions, solved crimes, and search operations since June 6. Regional departments have also stopped publishing daily reports about local criminal activity.

From June 1 to June 6, Interior Ministry regional offices published 1,438 news reports mentioning the words “detain,” “disclose,” “search,” or “Criminal Code.” Between June 7 and June 13, this figure dropped to 71 reports (20 times fewer). Since June 7, police reports about ongoing activities have dealt mostly with searches for missing persons.

Deputy scoundrel 😈

What follows is a paraphrased retelling of Leonid Slutsky’s June 13 interview with the website Snob. Multiple journalists have accused Slutsky, who chairs the State Duma’s foreign affairs committee, of sexually harassing them over the years when they approached him for comments. A Duma ethics commission recently exonerated Slutsky from misconduct charges, leading several media outlets to withdraw their parliamentary correspondents in protest.

So long and thanks for all the hawkishness 👋

German Klimenko is no longer Vladimir Putin’s point man on the Internet, following the president's decision on June 13 to fire him. As a Kremlin adviser for the past two and a half years, Klimenko stood out for eagerly and openly supporting more censorship online, whether it was banning instant messengers, blocking Bitcoin, or modeling the RuNet’s isolation on the Chinese Internet. Meduza recalls Klimenko’s greatest “accomplishments” during his time as Vladimir Putin’s Internet guy.

The opposition is set to eat itself in Moscow, again 🗳

On Wednesday, the “Civic Initiative” party nominated former State Duma deputy Dmitry Gudkov to run for mayor of Moscow. He says he’ll soon submit the necessary paperwork to the city’s election commission. Gudkov is one of more than a dozen politicians, including incumbent Sergey Sobyanin and fellow oppositionist Ilya Yashin, who have already announced their intention to seek mayoral candidacy.

Gudkov and Yashin previously stressed the democratic opposition’s need for mayoral primaries, to avoid cannibalizing the anti-Kremlin movement’s admittedly limited number of votes. Personalities clashed, however, and now the two men are set to go head-to-head.

The municipal filter. But running to be mayor of Moscow takes more than a simple announcement; even a formal nomination from a political party doesn’t get you on the ballot. The city has what is lovingly called “the municipal filter,” meaning that individuals need to get the support of at least one municipal deputy in at least 110 different districts of Moscow, in order to be registered as a candidate. The only political party with that many deputies spread across so many districts is United Russia, the country’s ruling political party.

But did they offer gluten-free? 🍔

New Yorkers won’t have the Russian fast food chain “Teremok” to kick around anymore. The company’s general director, Mikhail Goncharov, announced on Wednesday that Teremok has closed down its two restaurants in the Big Apple, saying he sees no chances for expanding in America, until U.S.-Russian relations improve.

In March 2018, Goncharov accused New York city inspectors of “open hostility” toward Teremok’s restaurants and staff of roughly 30 people. Inspectors reportedly asked about the company’s ties to Vladimir Putin and Russian money laundering. In mid-March, health officials closed down one of Teremok’s New York restaurants, after finding several violations, including rodents where they shouldn’t be. The restaurant passed a follow-up inspection, a couple of weeks later.

Late to the party 🚓

In a time-honored practice, Moscow police officers showed up at a theater on Wednesday in response to a “bomb threat,” interrupting what was supposed to be an opposition-related event. But things went a little off script this time, as the authorities arrived at the “Theater.doc” building, looking to break up the performance of a play dedicated to Oyub Titiev, the jailed chairman of the human rights group “Memorial” in Grozny. That show was happening at another location (at Memorial’s office), however, and it had ended by the time the police turned up there to shut it down. After a K-9 unit inspected the building, the authorities found nothing and left.

Chechen police arrested Oyub Titiev in early January after allegedly finding 180 grams of marijuana in his car. Titiev says the drugs were planted. In March, the Attorney General’s Office said it found no procedural violations in Titiev’s case. In late May, police detained his nephew (also on drug charges). Both the European Union and United States have called for Titiev’s release.

Not friends anymore 😤

Kaspersky Lab has suspended its work with European law enforcement agencies, including Europol, following the European Parliament’s adoption of a resolution calling for greater protections against malicious cyber attacks from Russia, China, and North Korea. The company objects to the resolution’s claim that Kaspersky Lab’s software is potentially dangerous, saying it won’t work with European police agencies until it gets a clear, official explanation for the allegations.

In 2017, the U.S. federal government stopped using Kaspersky Lab software, arguing that it is vulnerable to snooping by Russian intelligence. In May 2018, Dutch authorities also ditched the company’s products as a defensive step against Russian cyber meddling.

He's back! ✌

Dmitry Serebryakov / AP / Scanpix / LETA

Opposition politician Alexey Navalny went free from jail on Thursday, after serving 30 days for organizing unpermitted anti-Putin protests on May 15. Navalny was also sentenced to 15 days for disobeying police orders, but the sentences weren’t “cumulative,” and he served them both simultaneously. Law enforcement have prosecuted more than 30 people who helped Navalny organize the May 15 rallies, including Navalny Live news anchor Ruslan Shaveddinov, former Moscow office coordinator Sergey Boiko, Anti-Corruption Foundation press secretary Kira Yarmysh, and Navalny volunteer coordinator Nikolai Lyaskin.

Compensation in Kemerovo 🔥

The Russian Red Cross says it’s finished paying compensation to the families of victims in the March 25 Kemerovo fire. In a report on its website, the group says it raised 161.9 million rubles ($2.6 million). Roughly 68.5 million rubles went to individual 1.15-million-ruble payments to victims’ families, and the Red Cross is also sending 14 survivors to health resorts in southern Russia and Crimea.

The fire at a shopping mall in Kemerovo killed 60 people, including dozens of children. Investigating the causes of the incident, police have arrested almost a dozen people, including the building’s owners, the local fire brigade commander, and the former regional head of the emergency management agency.

The Kuzbass regional government has also awarded compensation to victims’ families, handing out 318 million rubles ($5.1 million), raised from the burned building’s owner and the federal and regional state budgets. In June, the regional Council of People’s Deputies amended its budget to make an additional one-time payment to victims’ families totaling 194 million rubles ($3.1 million).

Yours, Meduza