The agenda: draft federal budget and allocations for state extra-budgetary funds, socio-economic development forecast and draft guidelines of the integral state monetary and credit policy for 2026-2028, raising subsistence minimum levels, insurance premiums for workplace accidents and occupational diseases.
Mikhail Mishustin’s opening remarks
Maxim Reshetnikov’s report on the socio-economic development forecast for the next three years
Anton Siluanov’s report on the draft federal budget and allocations for state extra-budgetary funds
Excerpts from the transcript:
Government meeting
Government meeting
Minister of Finance Anton Siluanov at the Government meeting
Minster of Economic Development Maxim Reshetnikov at the Government meeting
Government meeting
Mikhail Mishustin: Good afternoon, colleagues.
The Government is finalising the draft federal budget for the next three years. Today, we will review documents that will be submitted to the State Duma together with the draft federal budget. They include the national socio-economic development forecast, budgets of the Social Fund, the Fund for Mandatory Medical Insurance, and others. The Bank of Russia will submit guidelines of the integral state monetary and credit policy.
We heeded current challenges, while working on the main financial document. The global situation remains unstable. Instead of a projected recovery, the world economy continues to face new shocks, and various states are considerably revising bilateral trade parameters. Traditional financial institutions are distrusted more than ever before. Countries are looking for new options to safeguard themselves from excessive foreign pressure.
In these conditions, we had to implement our plans very cautiously. We had to evaluate risks for obtaining a stable resource base. Our approaches towards the three-year budget are very realistic. Some of them are rather conservative, including crude oil prices, the exchange rate of the rouble, and overall growth trends.
Most importantly, we had to minimise the impact of negative factors and to compile a well-balanced document. First of all, we aimed to maintain macro-economic stability and to accomplish various objectives, charted in accordance with national development goals, as stipulated by the President.
According to the Ministry of Economic Development, the GDP increased by 1.1 percent in January-July 2025. This is considerably better, compared to multiple states insisting that additional anti-Russia sanctions be imposed. This concerns countries which renounced mutually beneficial projects with our businesses and the entire country, and which continue negative rhetoric.
The real economy’s sectors, including machine-building industry, manufacturing, construction industry and agriculture, remain a key driver of economic growth.
The draft budget hinges on the basic scenario of the socio-economic development forecast.
According to the document, the GDP will grow by 1.3 percent throughout 2026 will increase by almost seven percent over the next three years while its face value will reach approximately 276 trillion roubles.
The Minister of Economic Development will follow up on this issue later.
And now let us look at the budget. I shall focus on key figures only.
For example, fiscal revenues in 2026 is forecast at 40.283 trillion roubles, with the share of non-oil-and-gas revenues to grow to almost 78 percent of the total. This means that the trajectory towards upgrading the economy and increasing the importance of higher value-added industries will be preserved.
This dynamic will make it possible to increase the financing of all obligations, programmes and projects. Next year, the federal expenditure as a whole will grow to 44.1 trillion roubles. The budget deficit level will remain acceptable.
Our three-year budget policy is directed at achieving the national development goals and attaining key national tasks.
There will be three priorities.
First, social support, primarily for families with children, as our President repeatedly said.
Second, the financing of national defence and security needs and support for families of the participants in the special military operation.
Third, developing infrastructure, as well as ensuring technological leadership, something for which the three-year budget will allocate about 1.9 trillion roubles. For example, the funding for the national machine-tool project alone will amount to nearly 118 billion roubles.
On the whole, about 40 trillion roubles are to go for the implementation of national projects until 2030.
The Minister of Finance will give you more details on specific budget indicators.
Today, we will also consider the Guidelines for the Unified State Monetary Policy for the next three years. Their main aim is to reduce annual inflation to 4 percent next year and fix it at that level thereafter.
Increasing incomes across the country is also on the agenda of today’s meeting.
We have drafted amendments to the effective laws on hiking the minimum wage amount. It will grow by more than 20 percent to 27,900 as of January 1, 2026.
This measure will increase wages of 4,500,000 people. This indicator is also necessary for calculating many other payments, such as holiday pay, sick-leave pay, as well as relevant allowances.
Our President has emphasised that the minimum wage currently already exceeds the subsistence level. And this adjustment will be continued.
The Government has been focusing on income growth issues.
While preparing the principal financial document, a draft budget for the Fund of Mandatory Medical Insurance was also submitted.
It provides for receiving free medical care under the national healthcare system. It includes initial consultation, prevention, medical checkup, ambulance call and many other important opportunities.
Over 14.5 trillion roubles from the Fund are designated for these purposes in the coming three years.
It will ensure provision of timely treatment based on the programme of state guarantees. Including taking necessary measures to support pregnant women and improve the availability of specialised aid for patients with complicated and severe cases, and which is very important, regardless of their place of residence.
Among other things, the Fund will also allocate money for payments to doctors and other medical personnel as well as for overcoming the shortage of medical specialists.
All these steps are part of a large work on achieving the goal set by the President to increase our citizens’ life expectancy.
Now let’s turn to the draft budget of the Social Fund of Russia.
Its activities are largely related to the protection of the rights of those who needs extra support and care. Among them are pensioners, people with disabilities, veterans and families with children.
The President underscored that fulfilling social obligations is a matter of vital importance. The Government conducts this work, including via the Social Fund.
In total, our plans are to provide about 60 trillion roubles within three years for implementing these tasks.
More than a half of the resources is intended for pensions, including their adjustment. We have also envisaged relevant payments to families with children and measures of support for the participants in the special military operation and their families. We will provide financing for a pilot project of comprehensive rehabilitation and habilitation of children with disabilities as well.
And one more thing. The agenda contains a draft federal law on accident and occupational disease insurance premiums.
Such information is necessary in the annual calculation of employers’ insurance premiums with due account of corporate labour safety records.
All the costs of fulfilling obligations to employees under this type of insurance have been provided for in the draft budget for the next three years. They will make up about 200 billion roubles next year.
We apply this money to support the people with disabilities who were injured at work. We give them temporary disability benefits and monthly insurance compensation, and provide with medical, social and professional rehabilitation.
We will go on implementing the decisions important for the people so as to raise the quality of their life.
Let us move to discussing the core issues.
I give the floor to Minister of Economic Development Maxim Reshetnikov. Go ahead, please.
Minster of Economic Development Maxim Reshetnikov at the Government meeting
Maxim Reshetnikov: Mr Mishustin, colleagues,
We have formulated a forecast for socioeconomic development over the forthcoming three-year period. In its preparation, we have taken into account current trends in the Russian and global economies, as well as all proposed amendments to fiscal policy, which Mr Siluanov will elaborate upon.
In 2025–2026, a deceleration in GDP growth rates is anticipated following the exceedingly high expansion of over 4 percent in 2023–2024. This stems from reduced inflationary pressures, which are imperative to achieve balanced and sustainable growth rates in subsequent years. Crucially, positive growth rates persist throughout the forecast horizon, with gradual acceleration expected in 2027–2028.
The primary driver of growth across all three years will remain domestic demand, predominantly consumer demand. The foundation of this demand lies in the rise of real wages and household incomes. Over the three-year period, real wages are projected to increase by 10 percent, while real disposable incomes will grow by more than 9 percent. Additionally, demand will be bolstered by a gradual decline in the savings rate as monetary policy normalises.
Throughout the forecast period, unemployment will remain low, and labour shortages will be mitigated through enhanced production efficiency and improved labour productivity.
A significant factor underpinning real income growth is the slowdown in inflation. The inflation forecast for 2025 has been revised downward to 6.8 percent. This has been made possible by the policies of the Bank of Russia and measures implemented by the Government. By the end of 2026, inflation is projected to reach the Bank of Russia’s target of 4 percent. The inflation forecast incorporates scheduled tariff adjustments in line with previously adopted decisions.
Regarding investments, a modest decline is expected in 2026 against the backdrop of exceptionally strong performance in preceding years. I would remind you that cumulative investment growth over the past four years has exceeded 36 percent in real terms. Investment growth will resume as early as 2027.
The forecast incorporates a gradual weakening of the rouble’s exchange rate. Nevertheless, the exchange rate itself will be stronger than envisaged in the April scenario conditions, primarily due to a more robust trade balance.
Furthermore, we have adjusted the Brent crude price downward for 2026–2027, from 72 to 70 dollars per barrel, reflecting current market conditions, OPEC decisions, and global production capacity. Concurrently, we anticipate a gradual reduction in the discount applied to Russian export prices.
Risks to the forecast persist. External risks include potential declines in demand and prices for Russian export commodities, driven both by a slowdown in the global economy and the imposition of new sanctions, including secondary sanctions.
On the domestic front, the key risk remains the trajectory of monetary policy easing and its impact on both investment and consumer activity. These risks have been factored into the conservative forecast scenario.
The baseline forecast scenario presented enables the formation of a balanced budget, ensuring the unconditional fulfilment of all social commitments, further implementation of national projects, and – critically – the resolution of defence and security priorities.
Fiscal measures to balance the budget guarantee compliance with the budget rule. This is a prerequisite for further inflation reduction, macroeconomic stability, and the potential easing of monetary policy – ultimately sustaining economic growth.
The alternative – expanding the budget deficit – would result in prolonged tight monetary conditions and, consequently, significantly lower economic growth rates throughout the forecast period.
Given more restrained growth compared to 2023–2024 and the associated budget constraints, economic policy must focus on expanding supply-side capacity, enhancing flexibility, and improving efficiency.
Critical priorities include increasing labour productivity through modern technologies, automation, robotics, and AI adoption; eliminating excessive regulatory requirements and implementing other systemic improvements to the regulatory environment; and pursuing targeted reforms in social sectors and the broader public economic sector.
A key efficiency factor is fostering fair competition. We are phasing out preferential treatment where it distorts business growth incentives – including by lowering the VAT threshold from 60 million to 10 million roubles and adjusting social contribution rates.
Another priority is improving investment efficiency – applying stricter performance benchmarks for public-sector investments and natural monopolies.
For private businesses, this means enhancing the investment climate via the national business model, comprising 250 concrete measures at federal and regional levels.
These and other measures are incorporated into the structural reforms action plan, drafted under instructions from the Russian President. Refined in consultation with all relevant authorities, it will be submitted to the Government shortly.
I request approval of the medium-term socioeconomic forecast as the foundation for drafting the federal budget.
Mikhail Mishustin: Thank you.
The floor is now given to Minister of Finance Anton Siluanov.
Minister of Finance Anton Siluanov at the Government meeting
Anton Siluanov: Mr Mishustin, colleagues,
The key priorities of the draft 2026–2028 budget are fulfilling social obligations to citizens, providing financial support for the country’s defence and security needs, supporting the families of the participants in the special military operation, and achieving the national development goals set by the President of the Russian Federation through 2030. The draft federal budget for 2026 and the planning period that we have prepared is balanced and sustainable, which is essential for maintaining macroeconomic stability and increasing real wages and household incomes.
Social policy is the budget’s top priority. A central focus is on measures to improve demographics. The “children’s” budget will amount to more than 10 trillion roubles over three years. This includes the payment of a unified child benefit to families in need, the continuation of the maternity capital programme adjusted to inflation, and the provision for families with children to withdraw any remaining maternity capital funds without specifying their intended use. More than two trillion roubles will be allocated to improve housing for families with children. These funds will be used to subsidise interest rates on family mortgages, provide one-off payments of 450,000 roubles to large families with three or more children, and partially repay mortgages.
Starting next year, an annual family payment will be introduced in the form of a partial reimbursement of personal income tax for citizens with two or more children. This payment will be needs-based.
As for healthcare, more than 900 billion roubles have been allocated over the three-year period for the implementation of the Long and Active Life national project. Funding is fully secured for medication programmes, including assistance to children with serious illnesses through the Krug Dobra (Circle of Kindness) foundation, cardiovascular disease prevention, and the provision of medicines for 14 high-cost nosologies.
As part of the Family national project, funding will also be allocated to the development of children’s healthcare facilities, the infrastructure of perinatal centres, children’s hospitals, and maternity hospitals. More than 94 billion roubles will be invested in this area over the next three years.
In the education sector, modernisation and construction of schools and kindergartens will continue to be a priority. Nearly 110 billion roubles have been allocated to finance the construction of 150 schools by 2030, while nearly 300 billion roubles will go towards major school renovations over the next three years.
More than 60 billion roubles will be directed to the renovation of vocational schools during the three-year period, and 170 billion roubles will be allocated for the creation of world-class campuses. The goal is to create 25 modern campuses by 2030, and more than 40 by 2036.
Major renovations of approximately 800 university dormitories are planned by 2030, with the necessary funding already allocated.
A strategic priority remains financing the country’s defence and security needs, as well as social support for the families of participants in the special military operation.
Budget resources will ensure that the Armed Forces are equipped with the necessary weapons and military equipment, that service personnel receive stable pay and family support, and that defence industry enterprises are modernised.
Funds will also be allocated to combat drones, strengthen the security of transport infrastructure, and reinforce border areas and the new regions.
Another crucial budget priority is ensuring technological leadership and infrastructure development. The budget for the next three years allocates approximately 1.9 trillion roubles for the implementation of national projects to strengthen technological leadership, that is, over 600 billion roubles annually during the three-year period. Priority allocations within the framework of national projects will continue. For machine-tool manufacturing alone, total funding over three years will amount to 118 billion roubles. New industries, such as microelectronics and robotics, will also be developed. Resources have been allocated for the recapitalisation of the Industrial Development Fund, which will provide preferential loan financing to companies engaged in technological advancement. More than 75 billion roubles have been designated for these purposes.
Necessary allocations will also be made for infrastructure development, including transport. Significant resources will be directed towards road maintenance and public transport modernisation. Road infrastructure funding will exceed previous levels, with 4.6 trillion roubles envisaged for this purpose over three years.
Programmes for creating a modern urban environment and the integrated development of rural areas will continue. Funding will also be provided for programmes to modernise public utilities infrastructure and eliminate dilapidated housing. Development of a core airfield network will be supported: at least 75 airfields will be reconstructed or built by 2030.
Regarding interbudgetary relations, the draft budget includes measures to support the sustainability of regional budgets. Resources are provided for adjusting subsidies to equalise budgetary capacity, while the implementation of individual regional development programmes and infrastructure projects will continue. Budget loans will also be extended to regions for infrastructure purposes, with a total of 1 trillion roubles allocated for this purpose between 2025 and 2030.
Resource support for priorities. As part of the budget package, amendments to tax legislation are proposed. A two percentage points increase of the standard value-added tax rate has been proposed– from 20 to 22 percent – to finance defence and security. Meanwhile, the preferential 10 percent rate will remain in place for all socially significant goods, including food, medicines, medical products, children’s goods, and other essential items.
Bookmaker taxation will also change. It is proposed to introduce a five percent gambling tax on bookmaker stakes, alongside the standard corporate income tax rate. This measure will make it possible to account not only for the turnover but also for the actual results of such companies.
There are also other measures to improve taxation. In order to prevent business fragmentation and minimise tax avoidance, lower income threshold for taxpayers using the simplified tax system is proposed, above which VAT becomes mandatory. This threshold is to be reduced from 60 million to 10 million roubles.
Lowering the threshold will enable growing businesses to make a smoother transition to the general taxation system. The share of VAT payers under the simplified system will account for 15 percent of all taxpayers.
Changes are also envisaged to preferential insurance contribution rates for small and medium-sized businesses. In sectors such as trade, construction, and mining, as well as several others, uniform rates will be established: 30 percent up to the maximum base and 15 percent above it. However, for priority SME sectors, including processing, manufacturing, transport, and electronics, the reduced insurance contribution rate will remain in force.
The reduced insurance contributions for SMEs were introduced as a temporary measure during the COVID-19 pandemic to maintain employment. The incentive has fulfilled its purpose, as the small and medium-sized business sector has demonstrated steady positive growth.
To tax fly-by-night companies, starting 1 January 2026, it is proposed that directors of such companies be required to calculate insurance contributions based on the minimum wage in cases where employees are formally paid below that threshold. These measures aim to reduce the scope of grey-market schemes in the corporate sector.
Considering the outlined approaches to budget policy, federal budget expenditure is projected at 44.1 trillion roubles in 2026, 46 trillion roubles in 2027, and 49.4 trillion roubles in 2028.
Revenue is expected to reach 40.3 trillion roubles in 2026, 42.9 trillion roubles in 2027, and 45.9 trillion roubles in 2028.
The federal budget deficit is forecast to average 1.4 percent of GDP over the three-year period, or 1.6 percent of GDP in 2026, 1.2 percent in 2027, and 1.3 percent in 2028.
Thus, we will return to a sustainable path of budgetary balance, which is the foundation for financing all government commitments and strengthening the country’s financial sovereignty.
We would like to ask for your support for the approaches presented.
Mikhail Mishustin: Thank you, Mr Siluanov.
Following today’s discussion, it will be necessary to additionally work on all the remaining issues.
In accordance with the Budget Code, the document must be submitted to the State Duma by 1 October.
