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Message from Vladimir Putin to the Federal Assembly. Main

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29 February2024
Message from Vladimir Putin to the Federal Assembly. Main

Special operation in Ukraine

  • We will not allow anyone to interfere in our internal affairs. The West wanted to do the same to Russia as it did to Ukraine, to bring discord and weaken it from within, but it miscalculated.

  • Russian business has sent billions of rubles to volunteers and charitable foundations to support fighters.

  • The Zircon sea-based hypersonic strike complex has already been used in combat; this system is already in service. Tests of the Burevestnik cruise missile and the Poseidon system are being completed. The Sarmat complex has been delivered to the troops, we will demonstrate it soon.

  • From March 1, 2024, Northern Military District veterans will be able to apply for participation in the first wave of the special personnel program “Time of Heroes.”

  • Participants in the special operation will be able to receive a mortgage at a preferential rate of 2%. The program will operate in a number of regions.

International politics

  • The strategic nuclear forces of the Russian Federation are in a state of full readiness. Russia is ready for dialogue with the United States on strategic stability.

  • The Russian Federation’s plans to place nuclear weapons in space are unfounded lies. This is necessary to draw us into negotiations that will benefit the United States.

  • The West claims that Russia is allegedly going to attack Europe, well, this is nonsense.

  • We remember the fate of those who sent their contingents to the territory of our country; now the consequences for the interventionists will be much more tragic.

  • There are plans to seriously strengthen the Russian Armed Forces groups in the western direction in connection with the accession of Sweden and Finland to NATO.

Economy

Social politics

  • should increase to 35 thousand rubles by 2030 .

  • The number of Russians living below the poverty line has dropped to 13.5 million people at the end of 2023, but this is still a lot.

  • The problem of poverty directly affects more than 9% of the population of the Russian Federation; it is necessary to achieve a level below 7% by 2030.

  • In 2025, programs for the overhaul of kindergartens will start, many of which were built during the Soviet years. The authorities will allocate more than 400 billion rubles for this.

  • It was ordered to launch a new program for the resettlement of emergency housing.

  • More than 4.5 trillion rubles. will be allocated until 2030 for the modernization of housing and communal services.

  • It was instructed to expand the social gasification program. There are plans to gasify the Kamchatka Territory, Krasnoyarsk Territory, Karelia and some other areas using LNG.

  • The Russian Federation will allocate 150 billion rubles. to update public transport.

Tax policy

  • It is necessary to modernize the tax system and fix it in a new form until 2030.

  • It is proposed to introduce a differentiated taxation system in the Russian Federation.

Economics Department Columnist Evgenia Kryuchkova:

One of the expected topics of the message was tax policy - although a substantive discussion regarding its further adjustment will apparently be postponed until after the presidential elections. The president’s proposals in this regard were quite general: the government was instructed to think through approaches to modernizing the fiscal system, “toward a more equitable distribution of the tax burden towards those with higher personal and corporate incomes” while simultaneously reducing the tax burden “on families,” in particular , due to tax deductions. De facto, we can talk about differentiating income tax rates for citizens - that is, increasing them for high incomes and reducing them (or expanding deductions) for low ones. The president did not specify how exactly this could be done. Let us note that the first steps in this direction have already been taken; in particular, the practice of tax deductions has been expanding in recent years, and from 2021 an increased personal income tax rate has come into force for citizens with an annual income of 5 million rubles or more. (15% instead of the standard 13%).

For business, the proposals made today partially answered some of the requests of the business community; the question of how they will be implemented still remains open. Thus, it is proposed to develop “incentive measures” for businesses investing in infrastructure development. In the future, the president added, taking into account the adopted changes, it is necessary to fix the basic tax rules until 2030 in order to ensure stable and predictable conditions for the implementation of any, including long-term investment projects. Business itself, in the face of increased pressures from the market - in particular, in the form of export duties and excess profit tax - has already spoken about the need to create predictable fiscal conditions. Among the proposals that have already been made by entrepreneurs is the differentiation of income taxes depending on investment activity.

National project "Family"

  • Regions where birth rates are below the Russian average will receive assistance - at least 75 billion rubles.

  • The family mortgage program will be extended until 2030 while maintaining the basic parameters.

  • The maternity capital program will also be extended until 2030.

  • Tax deductions should be doubled for the second child to 2.8 thousand rubles. For the third and subsequent children - up to 6 thousand rubles. per month.

National project “Youth of Russia”

  • From September 1, 2024, introduce an additional payment of 5 thousand rubles. per month for all educational directors' advisers in schools and colleges.

  • From March 1, increase the federal payment for class management and supervision of groups in technical schools to 10 thousand rubles.

  • 9 billion rubles will be allocated. from the federal budget to update the infrastructure of pedagogical universities.

  • Russia will allocate 120 billion rubles over 6 years. for the re-equipment of technical schools and colleges.

National project "Personnel"

  • By 2028, it is necessary to train about a million blue-collar specialists for high-tech industries.

  • By 2030, 12 leadership-level schools will be opened in Russia.

  • As part of the program for creating university campuses in the Russian Federation, 40 such facilities will be built, for which 400 billion rubles will be allocated.

  • The Priority 2030 program will be extended for 6 years, 190 billion rubles will be allocated for this.

  • It is necessary to increase the level of remuneration for teachers of fundamental disciplines in universities.

National project “Data Economy”

  • By 2030, we need to create digital platforms in all key sectors of the economy and social sphere; we will allocate at least 700 billion rubles for this.

  • Access to high-speed Internet must be provided throughout almost the entire territory of the Russian Federation.

  • RUB 116 billion will be allocated to expand the Russian satellite constellation .

National project “Long and active life”

  • The average life expectancy in the Russian Federation by 2030 should be at least 78 years, and then more than 80.

Society

  • It is necessary to introduce the opportunity to optionally retake the Unified State Exam in one of the subjects before the end of the university admissions campaign.

  • It is necessary to expand the Pushkin Card program.

  • Starting in 2025, we will launch the “Zemstvo Cultural Worker” program.

Export and import

  • Non-resource non-energy exports of the Russian Federation should increase by two-thirds over 6 years.

  • By 2030, the share of imports in Russia should decrease to 17% of GDP.

Technology development

  • It is necessary to double government and business investments in research and development, bringing them to 2% of GDP.

  • The share of domestic high-tech products in the domestic market should increase 1.5 times over 6 years.

  • By 2030, Russia should be among the 25 leading countries in the number of industrial robots.

  • Technological sovereignty projects will receive priority budget funding.

  • It is necessary to create at least 100 technology parks by 2030.

Economics Department Columnist Diana Galieva:

After the introduction of sanctions against the Russian Federation, one of the main challenges of the Russian economy was the loss of market access to foreign technologies - unlike many other “sanctions” effects, this factor is long-term and can weaken Russia’s position over the long term. Therefore, since 2022, the authorities have repeatedly called achieving technological sovereignty and the formation of a new technological economy in Russia a priority task. A legislative framework is now being created (a bill “On Technology Policy” has been developed) to bridge the gap between industry and science with the established practice of “patents on the shelf.” However, the main problem remains the high risks of investing in development: with ready-made solutions, it is easier for businesses to import technologies from accessible markets; budget participation in the development of such technologies by businesses can turn out to be toxic and carries the risk of criminal prosecution if results are not achieved.

Investments

  • The volume of investment in key areas of the Russian economy should increase by 70% by 2030.

  • New insurance guarantees and tax deductions for citizens' investments in the stock market were announced .

  • Individual investment accounts (IIA) in the amount of up to 1 million 400 thousand rubles. will be insured.

  • A “savings certificate” will be launched. It will be possible to place funds for a long term, and banks will offer more favorable interest income. These funds will be insured for amounts up to 2.8 million rubles.

  • The Russian stock market should double by 2030. Its capitalization needs to be increased to 66% of GDP. The launch of initial public offerings will be accelerated.

Economics Department Columnist Diana Galieva:

With the withdrawal of foreign investors from financial markets, the Russian economy is in dire need of alternative sources of investment. The state is ready to widely support the largest and most important investment projects from the point of view of a technological breakthrough, compensating from the budget the costs of investors for such projects and providing tax benefits to businesses. However, the authorities expect to attract funds from private investors to the market; for this purpose, the mechanism of tax deductions from income tax on voluntary pensions and simply long-term savings of citizens will soon be expanded. The potential is enormous: the government expected to increase the share of investment insurance and pension products in citizens’ savings from last year’s 21% to 26% in 2025 and to 36% in 2030.

However, the development of the Russian stock market is difficult without full disclosure of data about companies, but such disclosure entails sanctions risks. The Ministry of Finance reported that investors will have to rely more on data from auditors, rating agencies and independent directors of companies when making decisions. However, according to market participants, the Russian private investor is still “an unqualified audience prone to speculation, emotional and group behavior.”

Entrepreneurship

  • The Cabinet of Ministers needs to work out the parameters of the amnesty for small companies that were forced to use tax optimization schemes.

  • A business operating in Russia must have guarantees of the inviolability of its assets.

  • Small businesses will be able to take a six-month credit holiday every five years without deteriorating their credit history.

  • The temporary moratorium on business inspections has justified itself; from 2025 it is necessary to switch to a risk-based approach and minimize inspections.

Economics Department Columnist Evgenia Kryuchkova:

The very problem of pressure on entrepreneurs is quite widespread and is widely known to the public after a number of criminal cases against bloggers - last year the Federal Tax Service reported that the damage to the budget system from business fragmentation amounted to 500 billion rubles since 2018. The amnesty initiative expressed today differs from business proposals and, rather, is aimed at eliminating the consequences of the problem - this should be facilitated by the renewed instruction to provide for a gradual increase in the tax burden for growing small businesses starting next year. The business community itself has repeatedly asked for clear criteria for fragmentation, however, as the Federal Tax Service noted, this is very difficult to do due to the diversity and individuality of such cases. Businesses were also concerned about the tax consequences of fragmentation, which were proposed to be limited - the accrual of income taxes, VAT and penalties for the last three years, which, as representatives of business associations noted, sometimes leads to the ruin of the “fragmented” companies.

Regional policy

  • It is necessary to write off two-thirds of the regions' debt on budget loans. This will allow them to save 200 billion rubles. per year for investment.

  • The funds that the regions return to the budget of the Russian Federation on loans will be directed back to the development of the constituent entities of the Russian Federation.

  • Starting from 2025, we will increase the portfolio of infrastructure loans to the regions by at least 250 billion rubles annually.

  • By 2030, 10 “lagging” regions of the Russian Federation should become self-sufficient.

Economics Department Columnist Evgenia Kryuchkova:

Speaking about federal support for infrastructure development in the regions, Vladimir Putin proposed expanding it. In particular, we are talking about the actual resumption of issuing infrastructure budget loans (IBC). Let us recall that the program of budget loans at 3% and for a period of up to 15 years was launched in 2021 - within the framework of it, loans worth 1 trillion rubles were distributed, through which it is planned to implement more than 950 projects. It should be noted that the regions that submitted applications for an amount twice the limit have already asked for an extension of the IBC program - this was discussed in the government, but the idea encountered concerns from the Ministry of Finance due to the growing debt burden of the constituent entities of the Russian Federation and the approaching peak of repayments in 2025 of budget loans that were previously restructured. As the head of the Ministry of Finance Anton Siluanov said, we are talking about returning approximately 300 billion rubles. in year.

Vladimir Putin today proposed writing off two thirds of these funds—the released 200 billion rubles. per year is planned to be targeted, that is, the regions will have to direct them to support investments and infrastructure. The funds that the regions will return will be a source for issuing new IBCs. At the same time, Vladimir Putin spoke in favor of increasing the IBC portfolio from 2025 - in an amount of at least 250 billion rubles.

Ecology

  • It is necessary to increase the salaries of specialists in the fields of forestry, meteorology and the environment.

  • The creation of an Ecological and Environmental Objects Fund with a volume of 1 billion rubles was announced .

  • By 2030, in the Russian Federation it is necessary to sort all solid waste, everything that can be sorted.

Tourism

  • The contribution of tourism to Russian GDP should increase to 5% by 2030, and the flow of tourists throughout the country should grow to 140 million people per year.

  • In 2024, the M12 highway will be extended to Yekaterinburg, and next year to Tyumen.

  • The first route of the high-speed railway (HSR) between Moscow and St. Petersburg will pass through Tver and Novgorod. There are plans to build a high-speed railway to other cities, including Minsk.

  • Russia will allocate 250 billion rubles. for the development of the airport network.

  • The air fleet also needs to be updated using domestic aircraft; they must meet all modern requirements.

  • The intensity of passenger aviation in the Russian Federation should increase 1.5 times by 2030.

  • It is necessary to increase the capacity of railways in the southern direction, using the port capabilities of the Azov and South Seas.

  • We need to deal with the queues at border checkpoints; the inspection time should not exceed 10 minutes.

Source
Photo: Dmitry Azarov, Kommersant