- At the start of 2026, Russia increased its VAT rate from 20% to 22% to help finance the war in Ukraine.
- The measure is expected to generate an additional 1.187 trillion rubles ($15 billion) for the state budget in 2026.
- The increase has faced criticism from businesses and consumers already struggling with high inflation, sanctions, and rising defense costs.
- Income taxes have also been raised since the war began.
- President Putin stated the VAT hike is necessary to balance the budget and promised future tax relief, urging companies to comply and warning against fueling the shadow economy. Defense and security spending now accounts for about 40% of the 2025 budget.
Source: bta.bg
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
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