Russia Raises Taxes on Miners, Investors to Fund Ukraine War
The plan would raise revenue from consumers, savers and exporters as Russia faces a larger deficit and continued war spending.
- On Thursday, Russia's Finance Ministry published a draft 2026-2028 budget proposing new windfall taxes on commodity producers and sharp increases on foreign investors to narrow a widening deficit tied to nearly four years of war spending in Ukraine.
- Defense spending in the draft budget eases slightly to 12.6 trillion rubles, yet spending on national security and law enforcement is set to rise 13% to 3.91 trillion rubles, reflecting continued wartime financial demands.
- The Ministry proposed a 20% tax on gold sales and a 30% levy on metals and fertilizer producers, while planning to more than double the dividend tax rate on payments to countries Russia designates as "unfriendly," raising it from 15% to 35%.
- U.S. President Donald Trump recently described Russia as a "paper tiger" fighting "aimlessly," while analysts warned the fiscal measures demonstrate the severe strain of financing a prolonged war amid a slowing civilian economy.
- Despite these measures, the Ministry projects a budget deficit of roughly 2% of gross domestic product annually over the next three years; officials have acknowledged that extraordinary revenue measures will close only about half a percentage point of that gap.
21 Articles
21 Articles
Just after the Kremlin party won by a majority in the recent legislative elections, the Russian government has proposed an unpopular tax hike.
Russia is pushing for additional tax increases targeting Western investors as well as domestic companies and individuals to alleviate the financial burden caused by the prolonged war in Ukraine. According to the Financial Times (FT) and other sources on the 25th, the Russian Ministry of Finance proposed raising the tax rate applied to dividend income from investors, including those from so-called "unfriendly countries," from the current 15% to 3…
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(Seoul = Yonhap News) Reporter Kwak Min-seo = Russia has decided to drastically raise its dividend tax rate targeting Western companies and investors.
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