Against the backdrop of the war against Ukraine and the rapid growth of the budget deficit in Russia, tax pressure is increasing, with banks being the first to be hit. This was reported by the Foreign Intelligence Service of Ukraine, according to UNN.
Against the backdrop of the protracted war against Ukraine and the rapid growth of the budget deficit (which amounted to 4.19 trillion rubles at the end of eight months of 2025 – almost four times more than planned), the only realistic scenario for maintaining Russia's financial stability remains another tax increase.
It is noted that despite public promises by Russian dictator Putin not to increase the tax burden, the authorities are already discussing raising the VAT rate from 20% to 22%.
This decision, although contrary to previous statements, is inevitable: there is nowhere left to cut spending – either the army or social welfare, and neither option is being seriously considered. VAT is the main source of federal budget revenue. In 2024, it provided almost 37% of all revenues, or 13.5 trillion rubles. The last time the rate changed was in 2019 – from 18% to 20%. Now, to reduce the deficit and maintain the budget rule, the government is forced to take this step again. Other taxes have already been increased, and their effect is limited.
The projected deficit for the end of 2025 ranges between 5 and 8 trillion rubles, making the 2.2 trillion (0.9% of GDP) planned for 2026 a financial fantasy.
Banks will be the first to be hit: a bill on a one-time tax on the excess profits of credit organizations in the amount of 10% has been submitted to the State Duma. The calculation mechanism repeats the 2023 model, when a similar tax on large companies brought 315 billion rubles to the budget. Another 200 billion is expected from banks – a meager sum against the backdrop of the overall deficit.
It is emphasized that these steps are not a strategy, but an attempt to plug holes. The excess profits tax did not become a decisive source of income in 2023, and it will not be now. Raising VAT is not a reform, but a systemic crisis.
Addition
Reuters previously reported that under pressure from record defense spending and declining oil and gas revenues, Moscow is preparing a new budget with tax increases and cuts in civilian spending. Economists warn of the risk of recession, while Russia allocates more than 40% of its funds to the war against Ukraine.