For top earners and companies
Russia plans tax increases to finance war
29.05.2024, 07:54
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The warmongers in the Kremlin are doing everything they can to subjugate Ukraine – and are sparing no expense in doing so. According to the latest plans, further billions are to come from top earners and companies. Exceptions to the tax increases are planned for soldiers.
Amid efforts to raise additional revenue to finance the offensive in Ukraine, Russia plans to raise taxes on top earners and companies. The Finance Ministry’s plans include raising the corporate tax rate from 20 to 25 percent and increasing tax rates on top earners.
The increases would bring in around 27 billion euros per year, reported the news agency Interfax, citing calculations by the Finance Ministry. Finance Minister Anton Siluanov explained that the changes were aimed at a “fair and balanced tax system”.
According to the Ministry of Finance, exceptions are planned for soldiers fighting in Ukraine. The changes could be passed by parliament this year and come into force next year.
High spending, booming arms industry
Since Russian troops invaded Ukraine in February 2022, government spending has significantly exceeded revenue. Russia recorded a budget deficit of the equivalent of around 68 billion euros in 2022 and 2023. A deficit of around 17 billion euros is expected for the current year, which corresponds to around 0.9 percent of Russia’s gross domestic product.
The Russian economy is currently booming thanks to the arms industry. Economic output grew by 3.6 percent in 2023, and estimates suggest it could grow by a good 3 percent this year. This is largely due to the war-related industries. The number of arms factories has more than tripled since the start of the war, from fewer than 2,000 to 6,000 today.