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Russia’s Finance Ministry Submits 2026–2028 Budget Package With VAT Hike Proposal

Minfin frames the tax plan as financing defense and security.

Overview

  • The government said it will consider the draft 2026–2028 federal budget and the socio‑economic forecast at today’s cabinet meeting.
  • Minfin’s submitted package proposes raising the standard VAT rate to 22% from 20% starting in 2026 while retaining the 10% rate for socially significant goods.
  • The proposal would cut the VAT threshold for businesses on the simplified regime to 10 million rubles from 60 million to curb fragmentation and smooth the shift to general taxation.
  • Other draft measures include a 5% levy on accepted bookmaker bets plus a 25% profit tax, reformatting SME insurance‑contribution preferences, and charging directors’ contributions from the minimum wage when pay is below it.
  • Minfin flagged additional funding plans—over 230 billion rubles in 2025 for preferential mortgages, more than 1 trillion for healthcare over six years, and upward of 41 trillion for national projects—while draft rules to contain subsidized regions’ debt obligations undergo Justice Ministry review.