Sources at “Chronicles of Turkmenistan” report that throughout May at least 12 private companies, which were members of Turkmenistan’s Union of Industrialists and Entrepreneurs, closed down.
A few years ago membership in the Union guaranteed relative stability for businesses. However, under the current economic conditions, being close to the Union executive Aleksandr Dadaev and through him to government agencies, does not yield any dividends.
Recently the overwhelming majority of businesses, specializing in construction of residential and non-residential property, voluntarily have closed down. In the meantime the companies engaged in road construction are curtailing their operations.
The reason behind the closure of private businesses lies not only with the lack of orders or non-payment of previously commissioned facilities by the government.The thing is that previously a business could be kept “in the standby mode” , i.e.
when there were no business operations and, consequently, revenues, an empty balance sheet could be submitted to the Taxation Service for reporting.At present, regardless of the profit, the Pension Fund demands that monthly fees for all payroll staff be paid.
This is at least 10 employees.Consequently, businesses had to pay both bank and insurance services.
The procedure for liquidating a business entity is a time-consuming and costly procedure. However, according to entrepreneurs, it is more profitable to close a company rather than pay regular contributions without any profits.