Share your money, you fat cats! A business may be charged with an unexpected profit

Leonid Zlotnikov

Extremely interesting processes are taking place in the Russian economy, which is increasingly losing its market component, turning into a state one.

The authorities have seriously started discussing with big business voluntary contributions to the budget from the income that entrepreneurs received in the "financially successful" 2022.

"A voluntary contribution from the business, yes, it is being discussed, a one-time one. The fact is that the financial results of last year were very good, and many companies, especially in the first half of the year, for the first three quarters, the results were very positive", - the media quoted the words of Deputy Prime Minister of the Russian Government Andrey Belousov.

According to him, we are not talking about an increase in taxes, but only about a one-time payment of 200-250 billion rubles, that is, it will be a payment in the windfall tax format (English: with an unexpected profit). In turn, business, according to media reports, has made a counter-proposal to the government - to increase by 0.5% in 2023 the 20% income tax on Russian companies, that is, to make it 20.5%.

"This is seen as a voluntary story, business is actively involved in this," the Deputy Prime Minister added. The media also report that, according to preliminary estimates, the Russian budget in 2022 was executed with a deficit of 3.3 trillion rubles.

It is clear that the business will have to pay in any case, and therefore it is easier, in order to avoid unpleasant consequences, to do it right away.

Network analyst Anatoly Nesmian writes about this:

"It is necessary to share" is the slogan of the glorious nineties. And our bratva is just from there. Under the jackets and ties from Brioni - the same Abibas and a leather jacket. And a bit with a soldering iron..."

The experts of the analytical channel MMI draw such conclusions from this unpleasant situation:

1. this is a confirmation of the fact that it is becoming obvious that the situation with the budget will dramatically deteriorate, reserves are running out.
2. this is a vivid and clear illustration of the unfolding vector of economic policy: private investments are being replaced by public ones. This will have very bad consequences in the form of a deterioration in the quality of these investments and a decrease in long-term growth potential. Public investment now is mainly in the military–industrial complex.
3. this is a loud reminder of the investment attractiveness of the Russian stock market..."

The experts of the Ecworld channel do not hide that this is the soft nationalization of income (one of the tools), which they talked about in 2019-2020 and predicted for the middle and end of the 2020s:

"Gazprom was just the beginning. Now or after the elections (while maintaining the current foreign and domestic policy), the same fate awaits other large companies, then medium-sized businesses... and large deposits of citizens (nationalization of capital). This is the norm for a country that produces virtually no added value, lives off rent/exports of resources (and/or their derivatives without significant processing) and whose export opportunities have been cut off (sanctions and self-sanctions).

Where to get the funds from? There are few options:

▪️ issue (drawing through credit and deposit schemes with OFZ),

▪️ devaluation,

▪️ increase in taxes and ...

▪️ nationalization.

If in the 2000s and 2010s, thanks to high oil prices, Russians built up their airbag well and raised their standard of living - at the expense of the rent itself, and not the creation of added value/useful product) - and at the expense of loans, then now business/population will have to return to the elite what it is in in the previous 20 years, she swept the crumbs off the table (part of the rent that went to the population along the chain through contractors of the largest monopolies and infrastructure projects, increased salaries of state employees, and so on).

P.S. It does not matter in what form it is being implemented now (a one-time story or an increase in income tax), it is important that this is an uncontested trend for Russia [under the current policy]..."