The government has postponed raising the minimum wage until mid-2017

The government has postponed raising the minimum wage until mid-2017

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The view of the government House of the Russian Federation

Photo: Oleg Yakovlev/RBC

The minimum wage in Russia will increase from 1 July 2017, the increase will be the smallest since 1991. As previously wrote RBC, the government refused from the traditional raising of the minimum wage from January

The Russian government has decided to increase the minimum wage (SMIC) from 1 July 2017, said on Thursday “RIA Novosti” with reference to the press service of the Cabinet. The minimum wage will be increased by 300 rubles (4%), from 7.5 thousand to 7.8 thousand.

This is the least one-time increase in the minimum wage since 1991, with the amendment that the same amount (4%), the minimum wage was increased on 1 January 2016.

That the government can abandon the traditional to increase the minimum wage from the beginning of the year, earlier on Thursday, wrote RBC. This week the initiative has already approved the government Commission on legislative activities, told RBC two participants of the meeting.

The previous four years, the minimum wage was increased on 1 January. Its importance is that it determines the minimum monthly wage in the country, the size of temporary disablement allowances, to pregnancy and childbirth.

At the level of the minimum wage staff salaries are paid by many small firms, thereby minimizing the amount of tax on income of physical persons (personal income tax) and insurance contributions. It depends on the size of insurance premiums of individual entrepreneurs.

The minimum wage is 70% of the subsistence level of the working population. In 2002 the goal was to increase the minimum wage to a living wage, but now the Ministry expects that this will only happen in 2020.

In early October, Deputy Prime Minister Olga Golodets said that with a salary below the level of the minimum wage employs 4.8 million people.