Russia to Increase VAT Starting New Year

2025-11-29 08:31:14

(MENAFN) Russian President Vladimir Putin has issued a new decree that will raise the nation's value-added tax (VAT) rate from 20% to 22% beginning with the New Year.

The decree, released on Friday through the country’s legal information system, specifies that the increased rate will take effect on Jan. 1. However, it notes that VAT will continue to be "10% for some socially important products."

Russia’s Finance Ministry reported that the nation’s budget shortfall reached 4.2 trillion rubles (roughly $52 billion) during the first ten months of this year, largely driven by elevated government expenditures.

Government spending in Russia has surged notably in recent years, especially due to defense-related outlays.

Additionally, sanctions aimed at the Russian energy industry have prevented the country from accessing the European oil and natural gas market.

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