The Yabloko faction will support the law “On the Procedure for Forming the Federation Council” providing that the amendments targeted at its democratisation are adopted. Such a decision was taken at a meeting of the faction on June 22, 2000.

Deputies from the Yabloko faction reacted positively to the approval during work on the draft law by the Committee on Legislation of a number of amendments to democratise the procedure for forming the Federation Council. The amendments in general are in line with Yabloko’s concept of the law. In particular, the faction managed to achieve the following:

• a representative from the legislative body of the federation subject in the Federation Council shall be elected on an alternative basis by secret ballot;
• the candidacy of a representative may be proposed both by the Chairman of the chamber and one-third of the deputies of a legislative assembly;

The faction will also insist on the following: the head of the executive authority of the federation subject may also propose at least two candidacies for approval by the legislative authorities as a representative in the Federation Council from the executive authorities.

If these positions are adopted, Yabloko will vote for the draft in the second reading and will not insist on a return to the first reading. At the same time the deputies from the Yabloko faction expressed their concern about some amendments that had been approved by the Committee.

For example, the amendment obliging the representative the federation subject in the Federation Council to be guided in its work not only by the Constitution and federal laws, but also by “the interests of the federation subject”. According to the Yabloko faction, this may be interpreted as undermining the principle of superiority of federal legislation.

The faction will insist on the rejection of this change and some other amendments.

The Yabloko faction will support in the second reading the draft of Part 2 of the Tax Code on VAT, provided that the amendments approved by the Budget Committee are considered.

Such a decision was adopted at the meeting of the faction on June 22, 2000. In discussion of this draft the Yabloko faction will try to achieve the following:

1. Adoption of the amendment submitted deputies from Yabloko, Mikhail Zadornov and Alexey Mikhailov, regarding a change to the VAT regime for export-import transactions with CIS countries from the “country of origin” to the “country of destination” principle, which is effective today for Russia’s operations with foreign countries (excluding CIS countries). The Yabloko’s amendment approved by the Budget Committee will allow to increase the revenue part of the federal budget by about $400 bln per year and also considerably improve the competitiveness of Russia’s goods.
2. Rejection of the Government’s proposal on payment of VAT on the accrual basis. The faction consider this proposal strategically correct, but believes that it is still too early to adopt such a proposal, in view of the scope of arrears in the economy.
3. Abolition of VAT for individual entrepreneurs with an annual turnover of under 4 mln roubles (about $142.000). The faction thinks that the unconscientious behaviour of some representatives of private business should not serve as a basis for tightening the tax regime for the whole of private business