It is unlikely that russia’s planned revenue target for 2024 will be met as laid out in the budget plan. It is likely the government will need to consider other policy measures to fund its planned expenditure, the UK Defense Intelligence reports.
The russian government has ambitious plans to increase expenditure by 26 per cent in 2024. This is reliant on optimistic expectations of revenues rising by 22 per cent, with oil and gas revenues expected to increase by almost 25 per cent. It is likely that the government will need to reduce its contributions to the National Wealth Fund and increase domestic taxes and debt to fund its planned expenditure.
These policies will almost certainly have adverse effects on the economy in the medium to long term by maintaining inflationary pressures or constraining future economic growth. The National Wealth Fund is ostensibly for the long-term economic welfare of the russian people but is increasingly being used to fund its invasion of Ukraine, with the value of its assets falling 10 per cent in 2023.