The government discussed Russia's draft budget for the next three years.

The Cabinet of Ministers discussed the changes to the 2026-2028 budget proposed by the Ministry of Finance. The new budget's key priorities are the social sector, fulfilling all obligations under the Social Security Fund, implementing national projects, and achieving technological leadership. To this end, it is planned to change the tax system effective January 1, 2026. MK examines what awaits Russians.

Opening a government meeting, Russian Prime Minister Mikhail Mishustin emphasized that work on the country's main financial document—the federal budget—was designed with current challenges in mind. The global situation remains volatile. The expected global economic recovery is facing new shocks and a significant revision of bilateral trade parameters. "The main approaches to forming the three-year budget are as realistic as possible and somewhat conservative—in terms of oil prices, the ruble exchange rate, and overall growth dynamics," the head of government emphasized. According to the Ministry of Economic Development, our country's GDP increased by 1.1% in the first seven months of this year. "This is significantly better than that of a number of countries that are still pushing for stronger sanctions against Russia," Mishustin noted. He added that the real sector—mechanical engineering, manufacturing, construction, and agriculture—remains the key driver of economic growth. Russia's development will continue in 2026. "The document (the draft federal budget) assumes that GDP will grow by 1.3% next year," the head of government emphasized.

He added that budget policy over the three-year horizon is aimed at achieving national development goals. Three areas will be prioritized: social support for citizens, primarily families with children; funding for defense and security needs, including support for military personnel and their families; and infrastructure development and technological leadership. Overall, our country will maintain its focus on economic modernization.

To back up his words, Mishustin announced that the minimum wage (MW) will be increased in 2026. "It will increase by more than 20%, reaching 27,093 rubles as of January 1 of next year," he stated at the meeting. According to the Prime Minister, this will contribute to wage increases for 4.5 million people. Moreover, the minimum wage will continue to be indexed in the future. As a reminder, the current MW is 22,440 rubles.

Following the Prime Minister, Minister of Economic Development Maxim Reshetnikov spoke at the government meeting. He stated that Russian economic growth will continue "over the entire forecast horizon," accelerating in 2027–2028. Domestic demand, primarily consumer demand, will remain the primary driver for all three years, driven by rising real wages and household incomes. "In just three years, real wages will grow by 10%, and real incomes by more than 9%," Reshetnikov stated. Unemployment will remain low throughout these years. A slowdown in inflation will be a significant factor in the growth of Russians' real incomes. "The inflation forecast for 2025 has been lowered to 6.2%," Reshetnikov added. Furthermore, the Ministry of Economic Development expects a gradual weakening of the ruble, although the national currency will remain stronger than the ministry had anticipated in April.

According to Finance Minister Anton Siluanov, who spoke at the government meeting after the Minister of Economic Development, the draft federal budget presented is "balanced and sustainable." This is important for maintaining macroeconomic stability and increasing real wages and incomes. The federal budget deficit in Russia over the next three years will average 1.4% of GDP. The key priorities of the new document are social policy, meeting all the needs of the Central Military District, maintaining our country's defense capability and security, and technological leadership. "Considering the outlined approaches to budget policy, federal budget expenditures will amount to 44.1 trillion rubles in 2026, 46 trillion rubles in 2027, and 49.4 trillion rubles in 2028," the Finance Minister explained. “Revenue is expected to amount to 40.3 trillion rubles in 2026, 42.9 trillion rubles in 2027, and 45.9 trillion rubles in 2028.”

To achieve these goals, the government intends to reform taxation. First, the value-added tax (VAT) rate will be increased from 20% to 22%. The preferential 10% VAT rate will remain in effect for all socially significant goods, including food, medicine, and children's products.

Secondly, taxation of bookmakers will change. The Ministry of Finance intends to introduce a gambling tax of 5% of bookmakers' accepted bets, as well as a 25% tax on their profits.

Third, to combat business fragmentation and "gray" tax evasion schemes, the authorities want to lower the VAT payment threshold for small and medium-sized companies under the simplified tax system from 60 million to 10 million rubles.

Furthermore, the authorities will change the insurance premium rates for this same category of companies, effectively equalizing them with large businesses. If the budget amendments are approved, all tax changes will take effect on January 1, 2026. Benefits are provided, but only for certain categories of small businesses.

Related material: The Ministry of Finance is changing taxation