Putin approved the reduction of spending on the economy, but increased for the war

Russian President Vladimir Putin has signed a law on the federal budget for 2023-2025. According to the document, the government intends to collect 5.6% less taxes next year than in 2022. Oil and gas budget revenues are projected to decrease by 24%

Putin has approved a cut in spending on the economy in 2023 and a record increase in funding for the army, police and special services: 30% more will be spent on the security and law enforcement agencies, while 25% of budget spending will be classified

every third ruble will go to security and law enforcement agencies

The document suggests setting a living wage of 15,669 rubles for able-bodied citizens in 2023, 12,363 rubles for pensioners and 13,944 rubles for children.

For three years, the budget is expected to be in deficit. In 2023, the deficit is planned at RUR 2.93 trillion, or 2% of GDP, and by 2025 it should decrease to RUR 1.26 trillion (0.7% of GDP). Finance Minister Anton Siluanov has indicated that the Russian government does not plan to reduce expenditure, they will remain at RUR 29.055 trillion. Additional federal budget revenue for 2023-2025 is formed by withdrawal of part of the commodity super-rent.

We would like to add that the Russian Federation's spending during the 9 months of full-scale invasion and war against Ukraine amounted to about $82bn, which equals about a quarter of its annual budget.