After two years of robust growth fueled by military spending on the war in Ukraine, Russia’s economy is slowing. Oil revenues are down , the budget deficit is up and defense spending has leveled off.

The Kremlin needs money to keep its finances steady — and it’s clear where President Vladimir Putin intends to get it: at the cash register, from ordinary people and small businesses.

An increase in value-added tax to 22% from 20% is expected to add as much as 1 trillion rubles, or about $12.3 billion, to the state budget. The increase is contained in legislation already making its way through Russia’s compliant parliament and would take effect from Jan. 1.

More tax and fee increases are on the way

On top of the rate increase, the legislation lowers the threshold for requiring business

See Full Page