The price of this optimism is in tariffs and excise taxes
The government has announced a super optimistic budget for 2024, in which revenues will reach the astronomical amount of 35 trillion rubles, the deficit will be less than this year, and social support costs will rise. The devil, as always, is in the details. But they decided not to talk about them ahead of the weekend.
If consideration of such an important issue as the draft federal budget is scheduled for Friday evening, it means that someone needs it. Although the main parameters generally look positive and even impressive (for example, revenues are expected to increase by almost 10 trillion rubles compared to 2023), achieving them will require measures that can hardly be called good news. This means that they need to be reported when the news is no longer of interest to anyone. And you must agree that Friday evening is ideal for this.
It was not for nothing that Presidential Aide Maxim Oreshkin warned that the parameters of the new budget would cause mass “positive surprise.” If a year earlier the government rather uncertainly predicted that in 2024 revenues would be generated in the amount of 27.2 trillion rubles, today this figure has been adjusted upward, and quite significantly. As Mikhail Mishustin said at a meeting of the Cabinet of Ministers, the authorities expect revenues in the amount of 35 trillion rubles, which is 22% higher than previous expectations. Non-oil and gas revenues, he said, should be twice as high as oil and gas revenues. The prime minister did not explain where such growth would suddenly come from. From his speech it followed that the authorities were counting on “the further development of our economy.” The basic forecast of the Ministry of Economic Development assumes that in 2024 it will grow by more than 2%. Even despite the tightening of monetary policy. And the main drivers will remain investment and consumer demand.
It was not announced what oil and gas revenues will ultimately be at the Cabinet meeting, however, according to Bloomberg, which is not the first time to get acquainted with government documents before others, they will increase by almost a quarter to 11.5 trillion rubles. In this case, non-oil and gas revenues, taking into account Mishustin’s words, should reach 23 trillion rubles. The authorities did not seem to promise to raise taxes. But they still have other instruments of fiscal policy at their disposal — in particular, excise taxes and duties. For example, excise taxes on wine in 2024 will increase by 5% instead of the planned 4%. Also, excise tax rates on cigarettes and tobacco will increase once again. Other industries should not relax either. “We have provided resources to mobilize the revenue base, bearing in mind a more equitable distribution of natural resource rent, primarily in those industries where there is a consistently high return on capital,” warned the head of the Ministry of Finance, Anton Siluanov, without going into details. Let us remind you that just the other day the government has already introduced export duties on many goods, which will be in effect not only until the end of this year, but also throughout next year.
The head of the Ministry of Economy, Maxim Reshetnikov, while touching on sensitive issues, also diligently avoided specifics. It is clear that everyone — both businesses and even more citizens — is interested in tariffs. But here, apparently, the Cabinet of Ministers did not have any good news, so the minister at the government meeting limited himself to the following phrase: “Decisions on indexation of tariffs included in the forecast have been agreed upon with all line ministries and departments.” What exactly was agreed upon became known only two hours later from the department’s message. For industry, prices will be increased from December 1, 2023. In particular, gas prices for enterprises will rise by 10%, cargo transportation — by 10.75%. For the population, the increase in housing and communal services tariffs will be delayed until July 1, 2024, since presidential elections are expected in the first half of the year, and this is not the right time for painful measures. From the second half of the year, citizens’ total payments for utilities “will increase by no more than 9.8%,” the Ministry of Energy promises. The department has calculated that for a family of three living on 50 square meters, expenses will increase by approximately 500-550 rubles. The tariff increase was included in the inflation forecast in advance: it is expected to be 4.5% next year. At the same time, real incomes of citizens will increase by 2.8%.
As for budget expenditures, they will also increase significantly (to 36.6 trillion rubles instead of the previously expected 29 trillion) and, naturally, will exceed revenues. However, the deficit will be less than this year. Anton Siluanov emphasized that they deliberately tried to minimize the hole, and it is planned to close it through borrowing. The officials explained at length and in detail where the money would go, but, of course, they did not tell everything. The emphasis was placed on social support measures, implementation of the orders of the presidential address and national project activities. As Siluanov said, 4.4 trillion rubles are provided for the payment of a single benefit, 1.6 trillion rubles for maternity capital, a housing program for families with children — 482 billion rubles, a program for the modernization of primary health care — more than 200 billion rubles. etc. Mikhail Mishustin noted that the agenda also includes an issue that concerns the rights of SVO participants. The Defenders of the Fatherland Foundation will receive a grant of more than 5 billion rubles from the government.
Any other expenses related to the SVO were not announced at the Cabinet meeting. However, the same ubiquitous Bloomberg learned that military spending in 2024 will increase from 6.4 trillion to 10.8 trillion rubles. And financing of closed and secret items will reach 30% of the budget. The authorities plan to increase social spending overall by 1 trillion rubles to 7.5 trillion rubles. And expenses on education (1.5 trillion) and health care (1.6 trillion) should be kept at this year’s level