Following two years of intensive growth, largely fueled by the demands of the special military operation, the Russian economy is entering a phase of gradual correction. This period of adaptation to new realities is characterized by a number of challenges: oil revenues are shrinking, the budget deficit is growing, and military spending, having reached a certain plateau, remains significant. Under these conditions, the government is forced to seek additional revenue sources to maintain macroeconomic stability. It is becoming apparent that part of the financial burden will fall on the population and businesses. A key expected measure is an increase in the value-added tax (VAT) from 20% to 22%. According to a bill already under consideration by the State Duma, this initiative could bring about 1 trillion rubles into the budget starting January 1 of next year. Tax Base is Expanding In addition to raising the rate, lawmakers plan to gradually lower the annual revenue threshold for mandatory VAT registration from the current 60 million to 10 million rubles by 2028. According to the authorities, this measure is designed to combat tax evasion schemes where businesses artificially split their operations. However, it will also affect small enterprises previously exempt from this tax, such as cafes and beauty salons. The package of fiscal innovations also includes increased excise taxes on spirits, wine, beer, tobacco, and vapes. The cost of driver's license processing will also rise, and the preferential recycling fee rate for imported cars will be abolished. Furthermore, the introduction of a so-called 'technical' levy on digital equipment is under discussion. These steps indicate that the authorities indeed face a difficult choice in allocating resources between defense contracts and maintaining consumer demand. Reaction from Business and the Public A sense of wariness is palpable on the streets of Moscow. Citizens interviewed by journalists note rising prices and fear a further decline in their incomes. Pensioner Svetlana Martynova expressed a common opinion: 'I think small and medium-sized businesses will disappear. The budget will become smaller, not larger.' The VAT increase is accompanied by other changes. For instance, starting December 1, the preferential recycling fee rate of 3,400 rubles for powerful cars (over 160 hp) will be canceled. Owners of such cars will now have to pay a commercial rate that can reach hundreds of thousands of rubles. Andrey Olkhovsky, General Director of the Avtodom dealer group, noted in a comment for Kommersant that sales will decline in the short term but will recover within six months. 'The increase in taxes and levies will affect prices for the end consumer,' he stated. 'This will increase the cost of everything around us.' Background of Slowing Growth According to government estimates, Russia's economic growth will slow to about 1% in 2025, after exceeding 4% in 2023-2024. The high key rate of the Central Bank (16.5%), aimed at curbing inflation, and declining oil revenues are taking a toll. Western sanctions continue to create structural obstacles, deterring investment. As a result, the federal budget deficit for this year has been revised upward from 0.5% to 2.6%. As Finance Minister Anton Siluanov stated, increasing budget revenues is a more preferable path than increasing borrowing, which could spur inflation. Thus, after two years of a war-driven economy, Russia is entering a complex period of fiscal consolidation. As experts note, in the medium term, the government will likely face an increasingly difficult choice between funding military needs and maintaining the standard of living for citizens, who are already beginning to feel the weight of the new economic realities.

Under global pressure, the government is seeking optimal ways to support the economy and social guarantees