Russian President Vladimir Putin on Wednesday proposed various unconventional social measures to support families and businesses during the global outbreak of the corona virus, such as a week-long vacation for workers and higher taxes on dividends.
During a television speech to the nation, Putin tried to reassure Russian citizens and markets that the government would use all available forces to ward off the economic collapse.
Russia has reported 658 cases of coronavirus, with the largest increase in new cases on Wednesday, and says that nobody has died. However, the economy was hit by ongoing uncertainty about the corona virus and falling oil prices, causing the ruble to drop to a four-year low.
Putin's announcement that the next week, starting March 30, would be an extended holiday for workers, with the exception of key stores such as pharmacies, banks, and supermarkets, was an unconventional move. Some other countries have preferred to block cities, with people only approved for food and medicine.
"Russia's economy, like that of other countries, is under a lot of pressure due to the consequences of the epidemic," said Putin.
"It is now crucial to prevent the disease from spreading quickly, so next week I'm going to declare a week off without pay."
In addition to this measure, Putin said that unemployment benefits should be raised to reflect the minimum wage of 12,130 rubles (USD 153) a month, noting the need to support young people, a group of voters that he traditionally found difficult to vote in had to win.
He proposed increasing child benefit for all children under the age of three by an additional 5,000 rubles a month, and also proposed a six-month moratorium on tax payments for small and medium-sized businesses.
To combat the outflow of capital, Putin said that all interest and dividend payments leaving Russia should be subject to a 15% tax compared to the current 2% level.
"If foreign partners do not accept our proposal, Russia will unilaterally withdraw from these agreements," he said.
In addition, Putin said Russia will tax interest payments on deposits of more than 1 million rubles. This measure should help provide additional resources to combat the economic impact of the coronavirus.
Putin did not mention how much his new measures would cost the budget, for which a deficit of 3 trillion rubles is only expected this year due to weak raw material prices.
Russia has already used its Rainy Day fund, the National Wealth Fund (NWF), to help the ruble and some other sectors. As of March 1, the NWF held 8.2 trillion rubles, or 7.3% of its gross domestic product.
(Except for the headline, this story was not edited by NDTV staff and published from a syndicated feed.)