Russia is ready to relax the tax burden and reserve requirements imposed on commercial banks. Last month these constraints precipitated a banking crisis. In the future, according to First Deputy Prime Minister Anatoly Chubais, the government will allow private banks a flexible reserve requirement, and will reduce taxes on their profits. (Meanwhile, Moscow mayor Yuri Luzhkov told the Moscow Banking Association that he would introduce a city ordinance which would make banking activity in Moscow the most profitable in the country. (8)
The measures proposed by Chubais indicate that the Chernomyrdin government is seeking an alliance with the banks in the runup to December’s parliamentary elections.
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