The Russian government forecasts that the budget deficit will equal 2% of the Gross Domestic Product over the next three years and has proposed a series of tax increases to support military expenditures, according to documents presented on Thursday by the Ministry of Finance, reports Reuters.
The Ministry of Finance announced that it has submitted the budget project to the Government, which will analyze it before October 1st and will send it to the Parliament. The institution specified that the needs related to defense and security represent a ‘strategic priority’ in the new budget.
“The planned resources will allow the equipping of the armed forces with the necessary weapons and military equipment, the modernization of companies in the defense sector, and the payment of allowances for military personnel,” announced the Ministry of Finance.
The cost of the war in Ukraine, which has been ongoing for four and a half years, has increased for Russia; the economy slowed down sharply last year, and the Moscow government was forced to raise taxes and resort to additional loans to finance the war effort.
The Ministry of Finance has proposed increasing taxes on what it described as excessive profits in the metallurgy and fertilizer production sectors, generated by high global prices, as well as taxes on cross-border e-commerce.
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