Russia weighs post-election tax hikes to fund war in Ukraine
- Tax hikes on corporate profits and on high-earning individuals are being considered, people said
- Russian President Vladimir Putin announced plans to overhaul tax system after election
Russia is weighing options for big tax increases to raise as much as 4 trillion roubles (US$44 billion) as the war in Ukraine puts growing pressure on the government’s coffers.
Tax hikes on corporate profits and on high-earning individuals are being considered, two people involved in the discussions said, asking not to be identified because the matter isn’t public.
The government may raise personal income tax to 20 per cent from 15 per cent now for those earning more than 5 million roubles, and company taxation to 25 per cent from 20 per cent, according to the “Important Stories” news site and confirmed by two people involved in the discussions.
Russia’s Finance Ministry didn’t immediately respond to a request to comment.
President Vladimir Putin has announced he intends to overhaul the tax system once he returns for a new six-year term in this week’s elections.
In a February 29 speech to lawmakers and officials at Russia’s Federal Assembly, he said he wanted “a more equitable distribution of the tax burden toward those with higher personal and corporate incomes”.