Belarus Strongman Backs Down on `Parasite Tax' After Protests

(Bloomberg) -- Belarusian President Alexander Lukashenko put off the imposition of a new fee that had sparked the biggest anti-government protests in five years in this authoritarian country, giving his embattled opponents a rare win.

“We shouldn’t have touched the honest people,” Lukashenko said during a government meeting in Minsk Thursday, announcing the decision not to require payment this year of the levy, which had become known popularly as the “parasite tax.” 

The new charge, amounting to about 360 rubles ($187) a year per person on those deemed by authorities to be “employable non-taxpayers,” had triggered protests in all the country’s major cities over the last several weeks. Despite a long history of police crackdowns on public actions against the regime, some of the rallies attracted crowds as large as several thousand people, the biggest since mass demonstrations against the government in 2011. Opposition organizers plan their biggest gathering for March 25.

Vladimir Neklyaev, a leader of the Minsk protests, said that demonstration will still go ahead. “Our demand has been that Lukashenko scraps the fee altogether, not freezes it or plays some tricks,” he said by phone from Minsk. Neklyaev, a popular poet, ran against Lukashenko in 2010 and was beaten and thrown into prison before the election ended.

‘A Victory’

“In a way, this is still a victory,” Neklyaev said of the suspension announced Thursday. “But this decision doesn’t solve any of the problems which our country is facing. It only aims to dampen the wave of protests which threatens the regime.”

Facing a worsening economic crisis and declining subsidies from its larger neighbor Russia, Belarus began collecting the levy early this year. The charge amounted to the equivalent of half the average monthly wage and affected the nearly 470,000 Belarusians thought to live on the fringes of the nation of 9.5 million. But it turned into a rare show of civil disobedience with only one in nine people targeted by the law meeting last month’s deadline to pay the fee, jolting the authoritarian country.

The backlash adds to a volatile mix for Lukashenko, who has been in power since 1994 and is now locked in an escalating dispute over Russian shipments of oil and gas with President Vladimir Putin, his closest ally. With the economy contracting for a second year in 2016 and incomes shrinking more than 7 percent, his economic model is put to test as Russia cut oil shipments last year, blaming Belarus for accumulating $600 million in debt for gas deliveries.

To contact the reporter on this story: Aliaksandr Kudrytski in Minsk, Belarus at akudrytski@bloomberg.net.

To contact the editors responsible for this story: Balazs Penz at bpenz@bloomberg.net, Gregory L. White, Tony Halpin