This year has begun with significant changes in Russia's tax policy in the context of nearly four years of war against Ukraine. Starting January 1, the value-added tax (VAT) rate has increased from 20% to 22%, and the government has also introduced excise duties on electronics such as laptops and smartphones. These adjustments come after Russian President Vladimir Putin acknowledged in a press conference last December that the economy is slowing down and justified the upcoming tax changes as necessary measures to address economic challenges, asserting they are the "most appropriate, fair, and transparent way" to manage these issues.

In response to these tax increases, Russian businesses have reacted by raising prices for goods and services, effectively shifting the tax burden onto consumers. Reports indicate that logistics companies have raised their prices between 10% and 20%, and similar trends are observed in the food and healthcare sectors. This escalation in costs is contributing to a growing discontent among the populace, as the financial strain becomes more apparent amidst ongoing economic and social disruptions caused by the war and international sanctions.

The overall implications of these tax changes and price hikes suggest a troubling trajectory for the Russian economy, which has been grappling with the adverse effects of prolonged conflict, extensive sanctions, and domestic economic limitations. The populace is increasingly feeling the pinch as disposable income decreases, further threatening social stability and potential unrest. Experts warn that unless the government addresses these economic bottlenecks and consumer pressures more effectively, the outlook for Russia's economic recovery remains bleak.