Recent discussions about Russia’s tax policy focus on the potential impact of raising the personal income tax rate to 15% for individuals with annual income exceeding five million rubles. Projections suggest that this adjustment could lift federal budget revenues by as much as 75% in 2024 compared with 2023, reaching up to about 280 billion rubles. This assessment is based on data presented at a Federal Tax Service (FTS) board meeting and reported by Kommersant, a leading Russian business daily.
FTS figures indicate that in 2023, revenues from the so‑called increased personal income tax totaled 160 billion rubles, marking an uptick of 11 billion rubles from 2022. Looking ahead to 2024, analysts forecast an additional gain of roughly 120 billion rubles based on the ongoing policy discussions and the assumed stabilization of tax collection dynamics. The implication is that higher marginal rates on top earners could yield a meaningful expansion of tax receipts if the reform is implemented and compliance remains robust.
Officials note that tax reform is aimed at creating a more equitable distribution of the tax burden, with particular emphasis on higher earners. Daniil Egorov, who heads the Federal Tax Service, described the potential of increased personal income tax revenues to serve as a compelling argument for moving toward a fully progressive tax structure. In discussing reform priorities, he emphasized the link between rate design and revenue stability, while acknowledging the broader social objective of reducing disparities in tax payments across income groups.
From the wider fiscal picture, the Russian budget system collected a total of 46.8 trillion rubles in 2023, a level that surpassed the previous year by about 11%. The most notable gains occurred in income tax, which rose about 25% to 7.9 trillion rubles; in personal income tax, which increased around 14% to 6.5 trillion rubles; and in value-added tax, which climbed roughly 11% to 7.2 trillion rubles. The Federal Tax Service projects revenues could climb to roughly 52.5 trillion rubles in 2024, supported by ongoing collection efforts and policy levers under consideration.
In parallel, the Ministry of Finance has begun addressing tax optimization in light of forthcoming reforms. Officials stress the importance of strengthening enforcement against evasion and leveling the playing field for taxpayers. Alexey Sazanov, deputy head of the ministry, highlighted plans to curb abuses tied to gray wages and the shift from traditional labor relations to civil contracts when legitimate employment relationships are sought. Legal experts point to tighter oversight and greater employer accountability as essential tools for ensuring compliance and reducing opportunities for avoidance.
Before any final policy changes are enacted, the Federal Tax Service has continued to clarify statistics around the increasing personal income tax for high-income individuals. The discourse around these measures reflects a broader debate about tax fairness, revenue sufficiency, and how best to modernize the tax system to reflect economic realities. In Russia, as in many economies, tax reform considerations weigh the potential benefits of broader revenue bases against the administrative and social costs of reform. The conversation remains active as policymakers weigh the timing, scope, and design of any changes to top‑tier tax rates and enforcement mechanisms.
Overall, the trajectory of tax policy reform signals a concerted effort to balance revenue demands with equity objectives. As governments in different regions examine similar questions, the discussion highlights the crucial role of effective administration, transparent objectives, and predictable rules in sustaining taxpayer trust and ensuring adequate funding for public services.