In Russia, budgets are triennial, meaning that expenses and income are planned three years in advance. The state plans to earn the most in 2024.
Estimated Revenues:
- 2024 – 35 trillion rubles
- 2025 — 33.5 trillion rubles
- 2026 – 34 trillion rubles.
The biggest expenditures are planned for next year.
Estimated Costs:
- 2024 — 36.7 trillion rubles
- 2025 — 34.4 trillion rubles
- 2026 – 35.6 trillion rubles.
Thus, the Russian budget will be in deficit in the next three years. This means that planned revenues will not be enough to cover the agreed upon list of expenses. This situation is not unusual for Russia. Over the past decade, treasury revenues have exceeded costs by only three times.
Estimated Budget Deficit:
- 2024 – 0.9% of GDP
- 2025 – 0.4% of GDP
- 2026 – 0.8% of GDP.
The budget deficit over the next three years will not exceed 1 percent of the country’s gross domestic product (GDP). The GDP of the Russian Federation is expected to be 179.956 trillion rubles in 2024, 190.637 trillion in 2025 and 202.304 trillion in 2026. Inflation will be around 4.5 percent in 2024 and 4 percent in 2025-2026.
Income
More than a third of Russia’s budget will come from oil and gas revenues. This is the revenue from export duties and taxes of oil and gas sector businesses. They will fill the treasury 11 trillion 504.3 billion rubles (6.4% of GDP) next year. According to forecasts, there will be such revenues in 2025 and 2026 11 trillion 759.8 billion rubles (6.2% of GDP) and 11 trillion 414.7 billion rubles (5.6% of GDP).
Russian officials plan to earn additional money from oil and gas supplies abroad (Additional oil and gas revenues arise when oil prices exceed the budgeted level, i.e. $60 per barrel.) 1 trillion 821.1 billion rubles in 2024, 1 trillion 835.7 billion rubles in 2025 and 1 trillion 844.8 billion rubles in 2026.
In addition to the global oil price environment, the increase in oil and gas revenues will be associated with the “change in the established marginal discount” of Russian Ural oil to the reference North Sea Brent grade oil price, which will affect oil and gas revenues and the completion of the “tax maneuver”. This means reducing the export tax on oil to zero for six years from 2019 to 2024. At the same time, a gradual increase in the mining tax is expected.
Historically, oil and gas revenues have been the main item of the Russian budget. However, it is now assumed that revenues from other revenues (taxes, excise duties, e.g. gasoline, diesel and alcohol, fines, etc.) must be twice as high as oil and gas revenues. They will do more 23 trillion rubles in 2024 over 21 trillion – in 2025 and more than 22 trillion – In 2026. The ratio of non-oil and gas federal budget revenues to GDP will be 13.1% in 2024, 11.4% in 2025 and 11.2% in 2026.
Funds in the amount of 1.3 trillion rubles from the National Welfare Fund, Russia’s main “pot”, will be used to balance the federal budget in 2024. In addition to the National Welfare Fund, the main sources of financing the federal budget deficit in 2024-2026 will be state debts of the Russian Federation.
Expenses
According to Russian Finance Minister Anton Siluanov, the main priority of the Russian budget for the three years will be defense spending. 29% The minister said that Russia had never directed its spending towards “strengthening its defense capabilities”, but this was now a “primary task”. However, according to him, this does not mean that next year’s budget will be “military”.
Expenses for national defense 6% of GDP planned in 2024 or 10.736 trillion rublesIn 2025 – 8,520 trillion rubles or 4.5% of GDP. In 2026, this amount will reach 7.419 trillion rubles, or 3.7% of GDP. This is twice the cost to the country’s economy in 2024 and 2026, and 2.6 times in 2025.
to the national economy planned to be sent 3.934 trillion rublesor 2.2% of GDP, in 2025 – 3,257 trillion rubles (1.7% of GDP), in 2026 – 3,676 trillion rubles or 1.8% of GDP.
According to the budget amendment accepted in the second reading, most of the expenditures will go to expenditures. on social policy. Expenditures in this area will increase by 11%, or 2.2 trillion rubles, in the three-year period. So it will be this much: More than 7.7 trillion rubles More than 7.8 trillion rubles in 2024 and 2025 and a year later.
In particular, next year maternity capital payments will affect 1.3 million Russian families, and 7 million schoolchildren will receive hot meals. Classroom management bonuses will be given to 900 thousand school teachers and 100 thousand university teachers. An increase in pensions and minimum wage is predicted.
Overall, social expenditures account for approximately one-third of the state treasury’s expenditures. So it’s about the same as the military and security.
To improve health services Russia. A total of three years is given 7.23 trillion rubles.
According to State Duma Chairman Vyacheslav Volodin, 6 billion rubles will be spent on purchasing drugs for patients with cardiovascular diseases. Budget expenditures on health improvement and children’s recreation will increase by more than 3 billion rubles.
Also more 26 billion rubles will also be guided comprehensively rural development In 2024–2026. Subsidies for agricultural machinery manufacturers will be increased by 6 billion rubles annually.
To support regions A total of 264 transfers were made in the second reading of the budget 3.2 trillion rubles. This is about 9 billion rubles a year, mainly in subsidies to 38 military camps. 10 billion rubles are allocated annually for additional financing for the poorest people in the regions.
Budget Estimate
“Budget parameters influence social policy; First of all, the state fulfills its social obligations. Also for the defense capacity and security of the country, for promoting the development of economic sectors, for the development of major national projects. The budget also affects the ruble exchange rate: weak budget revenue indicators negatively affect the national exchange rate,” said BitRiver financial analyst Vladislav Antonov, commenting on the parameters of the adopted budget.
Candidate of Economic Sciences, Associate Professor at the Department of State and Municipal Finance at the Russian University of Economics. GV Plekhanova Anna Chalova believes that the parameters of the new budget largely reflect the goals and guidelines of the government and the Ministry of Finance of Russia, which are based on the normalization of the inflation background, restoration of purchasing and investment demand. According to him, there is a risk of budget failure.
“So the parameters do not fully take into account the risks of the Central Bank of the Russian Federation maintaining high interest rate and inflation expectations and do not take into account the possibility of a slowdown in economic growth. Therefore, the risk of non-fulfillment continues. “First of all, this concerns budget revenues, which will be 22 percent above the expected volume in 2023 and 7 percent above the spending dynamics in 2024,” he said.
However, according to him, the devaluation of the ruble will provide some “support” to budget revenues.
At the same time, Vladislav Antonov is confident that the state budget for the next three years will be fulfilled.
“External challenges to the budget could be the collapse in oil prices, new sanctions on the Russian economy or the geopolitical situation. But since the beginning of the 21st century, the Russian economy has experienced multiple global economic crises and each time emerged from the crisis stronger,” the analyst concluded.