Team Capital: Putin is confident in fulfilling all budget obligations to citizens

Russia was able to maintain macroeconomic stability in the face of sanctions restrictions. Vladimir Putin stated this on March 26 at the plenary session of the Congress of the Russian Union of Industrialists and Entrepreneurs (RSPP). Due to the stress on world markets and rising oil prices, the president urged the authorities and businesses not to succumb to the temptation to "take advantage of the situation" and "eat up" the proceeds from price increases - markets may swing in the other direction, so "moderate conservatism" in spending is needed.

What is the biggest concern for business in Russia

The Congress of the Russian Union of Industrialists and Entrepreneurs was held in Moscow on March 26. This is a large-scale economic event where business and government representatives meet year after year to discuss accumulated problems and try to find ways to resolve them in the common interest. In recent years, businessmen have gathered at the Moscow House of Music on Kosmodamianskaya Embankment. Now the National Center "Russia", which is located in the Expocentre, has become the venue of the congress. Moreover, the site will grow — a new building of the national center will appear nearby, it has already begun to be built. The opening is scheduled for 2029.

The Head of State always participates in the plenary sessions of the Russian Union of Industrialists and Entrepreneurs — this year was no exception. As a rule, before Vladimir Putin's exit, business representatives already have time to thoroughly discuss the main issues with the authorities. The atmosphere at this event is usually quite serious, but on this day it was diluted by a small technical problem.

The music did not start playing at the beginning of the congress. The head of the Russian Union of Industrialists and Entrepreneurs, Alexander Shokhin, began to sing the anthem a cappella, but the whole hall quickly joined in. However, there were still some rough edges in this unity — the main issue that worries entrepreneurs seemed to be in the air. And the head of the Russian Union of Industrialists and Entrepreneurs, Alexander Shokhin, asked the Finance Minister directly.:

— Anton Germanovich (Siluanov. — Ed.), will you raise taxes? I've already said that the companies surveyed seem to be waiting for another round of tax increases to take place.

Since January 1, 2026, the VAT rate has increased from 20% to 22%. It is assumed that the changes will bring an additional 1.7 trillion rubles to the budget in 2026, with 1.2 trillion rubles of them coming from VAT. Anton Siluanov avoided giving a direct answer, but explained to the assembled entrepreneurs that the main task of the ministry is to ensure a balanced budget. The agency will achieve this through cost management and "improved administration." "We hope that, indeed, the improvement of administration will not affect the interests of bona fide taxpayers," Shokhin concluded.

What does Putin think about the Russian economy in the face of sanctions

The head of the Russian Union of Industrialists and Entrepreneurs spoke about other business problems when the president joined the plenary session. The work of entrepreneurs has been complicated by problems with mobile Internet and communications, which have been occurring for the second week in Moscow, the Moscow region and a number of other regions. Businesses are asking to find a "systematic, balanced solution" that will help them in their work and ensure the security of the country. After listening to the report, Vladimir Putin told the audience that he regularly meets with the head of the Russian Union of Industrialists and Entrepreneurs, and, by the way, he "works out" the trust of business. After that, the president congratulated Alexander Shokhin on his re—election for another term, who has been heading the union since 2005.

Vladimir Putin promised in his speech that the state would continue to reduce administrative barriers for entrepreneurs, including through electronic services. He also recalled that the government had approved a national model of targeted business conditions for the horizon up to 2030: its first results would be reviewed before the upcoming SPIEF. Among them, for example, is the idea of creating a unified investor support system in the Russian Federation. Vladimir Putin noted that we are talking about comprehensive professional support for both domestic and foreign investors throughout the life cycle of the project.

In general, we can already talk about the progress of the Russian Federation in international business rankings: moreover, these are not only expert assessments, but also the opinion of entrepreneurs themselves. Russia, despite the sanctions, manages to maintain macroeconomic stability and achieve stable and predictable dynamics of inflation and unemployment, the president noted. He assured that all the obligations of the budget to the citizens will be fulfilled. It is also important to continue to increase the competitiveness of the domestic economy in both the external and domestic markets in order to strengthen its own sovereignty.

— I think no one doubts what sovereignty means in the modern world, what it is worth, and what consequences arise for those countries that voluntarily renounced this sovereignty, assuming that it would be calmer, cheaper to live, and better conditions for economic development could be created, yes and social networks, too," the president said.

How will Russia deal with excess oil revenues

At the event, Vladimir Putin gave an extensive assessment of the global business market. According to him, trusting cooperation between government and business is especially important today against the background of the growing level of uncertainty and stress in global markets.

On February 28, a new round of escalation of the conflict in the Middle East began — the United States and Israel launched attacks on Iran. In response, the Islamic Republic attacked both Israeli territory and American military installations throughout the Middle East — in Bahrain, Qatar, the United Arab Emirates, Kuwait, Saudi Arabia, Jordan and Iraq. Commodity quotes reacted to the incident. Brent crude oil gained more than 40% — by 17:45 on March 26, it was above $107 per barrel. At the same time, the price of Russian Urals increased by more than 60% to $99. Moreover, at the auction on March 20, it reached $ 106 per barrel.

— Now, when the quotations of our traditional exports are growing, but the markets are also in a fever, there may be a temptation to take advantage of the situation, get opportunistic incomes and, as they say, eat them up and use them for dividends, — the president noted.

The same thing can happen if the finances from the new revenues are used for state budget expenditures, and they also do not need to be inflated too much, Vladimir Putin added. He explained that if the markets "swung one way" today, they may "change the other way" tomorrow. According to the head of state, in this case, a "moderate conservative approach" is needed.

"The events that the world community has been facing in recent years show that shocks in trade, investment, and international relations in general are occurring more and more frequently," the President stressed.

As Izvestia reported earlier, if energy prices remain high, the budget may receive up to 3.5 trillion rubles by the end of the year. Against the background of the rising cost of Russian exports, it is not worth making long-term commitments, the press service of Freedom Finance Global noted. This applies, for example, to plans for budget expenditures. When additional income is temporary and expenses become permanent, in a few months or quarters this can lead to more stringent budget adjustments, reduced investments and an increased debt burden, experts noted.

In conditions of instability of global markets, radical changes cannot be introduced, Yulia Myagkova, Associate Professor of the Department of Global Financial Markets and Fintech at Plekhanov Russian University of Economics, is convinced. Russia should not take hasty steps— either in investment or spending, so as not to expose the economy to excessive shocks. At the same time, obligations to citizens — pensions, salaries of state employees, social benefits, national projects in healthcare and education — should be funded first and be protected as much as possible, the specialist added.