Page 108 - RusRPTMar23

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The government is against the proposal of the Russian Union of Industrialists and Entrepreneurs to raise the corporate profit tax in 2023, it has no plans to change the taxation system this year, the Finance Ministry said in a statement on February 8. “In general, we plan no changes to the basic parametres of the taxation system, including the corporate profit tax, value-added tax, the personal income tax, property taxes, special regimes, and insurance payments this year. The Russian government is not working on initiatives like that,” the authority said.
The government is discussing a one-time budget contribution in 2023 with large companies, but is not negotiating a tax raise, First Deputy Prime Minister Andrei Belousov said on February 8. "A voluntary contribution by the business is indeed being discussed, a one-time one,” Belousov said.
The 2023 budget calls for a 34.4% nominal increase!)#!0/5/#'/!'+/#0)#E!
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GDP to 17% of GDP, implying significant real-term cuts to state-backed capital investments and cuts to social spending. That’s a 15% cut in spending at a time when the economy can no longer rely on foreign demand to buoy output, incomes, and investment.
The long-standing preference for fiscal restraint has been matched by a balancing act between avoiding excessive unemployment, maintaining inefficient Soviet-era industries in remote places, and improving business efficiency. Economic policy has long disciplined labor at the expense of business by ensuring that significant amounts of slack are always present, relevant as an anti-inflation measure by limiting wage gains and a political tool to ensure the public does not become too free of its dependence on state spending and programs. The current drive to convert existing productive
108 RUSSIA Country Report March 2023 www.intellinews.com