Here’s a riddle: if the Ministry of Finance will continue to save the currency, and the Bank of Russia will marry her at an outdoor market, then what will happen to the ruble? Judging by the dynamics of the oil market, this macroparameter in 2019-2021 years may slightly differ from the model of the Ministry of Finance, and the volatility of the ruble will be more than you need CB to return for regular purchases of foreign currency. So, the Central Bank may not enter the open market and the ruble in the next three years will be relatively strong. However, from the point of view of economic growth is not very good.
VAT, taxes for self-employed and other charges
The increase in VAT, additional charges and taxes, as well as the transfer of non-tax charges in the Tax code, obviously, affect real disposable incomes, which in the current 2018 is not to say, to boldly grow: for the first 10 months of 2018, they increased only 1.6%. Yes, this is roughly equivalent to GDP growth, but rather whether such dynamics for the implementation of national projects (one of them is the reduction of poverty)? So the question about the impact of taxes on the achievement of the objectives of the “may decree” Putin remains open.
Characteristics of the budget
Interesting was the growth of the fees. From 2018 to 2019, it will amount to about 17% in nominal terms. Given expected inflation of about 4.3%, economic growth of about 1.3% and a decline in oil prices, we understand that fees will grow at a faster pace.
This trend is alarming. Despite the fact that improving fees caused by better tax administration, it also means a decrease in disposable funds in the hands of citizens and businesses.
It should be noted that “lock translation” for small amounts between the accounts of the Russians there — it is the fight against money laundering and fraud.
About national projects has already bet the head of the accounts chamber Aleksei Kudrin and economy Minister Maxim Oreshkin. The planned spending for these purposes appear approximately as expected since the signing of the new “may decree”. The share of national projects in the budget will gradually increase from 9.3% to 10.2% of all expenditure.
One of the most important areas is demographics. Improvement of statistics on cardiovascular disease, the fight against alcoholism and Smoking could help without such a large expenditure to make progress in the implementation of the national demographic. These measures, however, are sewn up in “health” and “demography” — the duration of life, sports activities, increase in the birth rate. In General, it seems that the costs provided for the implementation of demographic necroart, will eventually be spent on health care.
Alarming and not-so-significant increase in spending on education and science. Of course, for retraining of citizens in the new digital economy will have to develop a separate system of measures, but the cost of this story may not be very large. But science in the new world plays a crucial role, since it needs know-how and technological innovation, so it makes sense to support wider.
The budget for the 2019-2021 years was conceived as a “development budget”. Funds allocated to achieving the strategic objectives, is still small. It would seem that 10% of all Federal spending is quite a lot, but there are nuances in the use provided for under the relevant articles of money.
Relative to GDP, the size of which is approximately 100 trillion of the proposed $ 1.5 trillion per year is 1.5 percent. Surely these costs will help the growth of the economy, but whether he can return to the area of 3-4% annually to match global level is unclear.
Oil prices do not bring happiness in recent weeks, the threat of sanctions does not disappear, so Russia needs to find something new, whether it is labour productivity growth in all sectors of the economy or a sharp increase in investment. The national projects provide the only chance through the development of infrastructure and possible increase in health/human capital, but work is a lot.