Forty -five uncertainties

Summer calm unexpectedly turned into autumn troubles: the government, back in June, confident that everything is fine with the budget, discusses alternative options for the already ready - and very tough - budget and possible increase in taxes. Oil, standing $ 45 per barrel, does not suit either reformers or conservatives - it is not possible to enter in 2017, without political, and even more economic consequences, none of the possible decisions of the authorities will remain, including the decision to decide anything.

Panic on the beach

In the appearance of the summer of 2016, for the Russian government, it was a textbook Russian summer: nothing serious happened, all decisions on the future budget were adopted the latest in June, and mainly in April -May there were technical work, officials, even those who did not rest on vacation, were not particularly strained and languidly discussed, which to expect in the fall. Back in April, at the meetings of Vladimir Putin it was decided that in 2017-2019, the maximum amount of budget expenditures will be recorded by the amount of 15.4 trillion rubles. per year. In practice, this meant that the problem of reducing expenses by ministries exists, but its main severity is delayed for 2019. But 2019 is far away, this is after the presidential election, when the term expires and Putin’s promise not to raise taxes in this budget cycle.

True, in June literally briefly, leaks, information began to appear that the head of the Ministry of Finance Anton Siluanov nevertheless made some proposals for an unscheduled and immediate increase in taxes, but in the official correspondence it was not possible to find any traces of these initiatives. And why raise taxes now? Oil costs $ 45 or more, the budget is believed, based on $ 40 per barrel, there is no economic growth - but there is no collapse. You look, and it will cost. And if not, we have a reserve fund.

In the first version of the budget, income tax increases, in the second - VAT, in the third - state loans are sharply increased

The weather began to deteriorate in August, and the answer to the question "What is happening with the budget?" It has already become not obvious. Trenches from the government stubbornly attributed to him the desire to immediately increase anything-VAT, personal fees, social fees, income tax, excise taxes, introduce some fantastic gazing, real estate and bank deposits, increase the retirement age, cancel cash, transfer everyone to the Mir cards, stop paying pensions to working pensioners, and introduce a tax on the tax. Tuneus and on travel abroad. All these leaks were very sluggishly refuted by the government, and in mid -September, Anton Siluanov specifically devoted part of his speech at the Moscow financial forum to exposure seemingly non -existent and no one’s necessary initiatives to increase taxes.

At the same time, the budget, which was peacefully written by officials of the Ministry of Finance, turned from three -year -old to annual and vice versa. By the end of August, sources in the government started talking about the fact that the reserve fund was unexpectedly exhausted by January 1, 2017, although two months ago it should have been enough until the beginning of 2019, and the national welfare fund, which no one was going to spend before, had already begun to divide. There were rumors about expressions in Moscow in which the Minister of Defense Sergei Shoigu demanded that the Ministry of Finance increase the double -term program for the purchase of weapons - it is necessary to spend on it until 2020 not 10 trillion rubles, and 20 trillion rubles, despite the fact that there are no 8 trillion for these purposes for the Ministry of Finance in the design.

By the end of September, the atmosphere around the future budget turned into some ghostly hell. On September 21, at a meeting of Vladimir Putin, it was finally decided: the option “We do everything as we decided in June” was still left by the president as the main one. However, by October 5, the Ministry of Finance and the Ministry of Economic Development should represent three alternative budget options. In the first - income tax increases, in the second - VAT, in the third - the budget deficit for 2017 is sharply increased and state loans are equally sharply increased. Rumors materialized in the most unpleasant way-after a week or two, the country can enter into a fundamentally new economic reality, since all the proposed changes are completely not cosmetic.

Pandemonium

Alas, in the economy, everything is quite logical - most of the oddities around the budget were connected with the fact that on the eve of the State Duma elections, in September 2016, it was clear to all government officials that any attempt at public discussion of existing problems would be perceived as an attempt on a future state system with relevant personnel conclusions. Meanwhile, a mine under the budget process was laid back in February 2016 - the current budget for this year, which should be adjusted in October, was executed based on the oil price of $ 50 per barrel. On a single spring or summer day, the Urals barrels did not cost so much-and although the $ 40 plank for the barrel for the Russian statehood for a barrel was lowered for only some weeks, all the next six months the power accumulated conditional obligations to the ministries-ab-servants. Russian officials make 40% of expenses in the IV quarter of this year, so until September, no one in the departments paid attention to the missing three to four to five dollars from each barrel. But vague anxiety has been accumulating - and where the Ministry of Finance will take money to put billions under the Christmas tree as it is customary in Moscow? They seem to be not?

In turn, the problem was best understood precisely in the Ministry of Finance - and used it as a tool for balancing the budget until 2019. Stubbornly do not want to understand that it was necessary to spend less in 2019, were afraid of the immediate sequestr already in November - December 2016, and those who were indignant at the future sequestration of November were frightened by cutting expenses of 2017-2019. More structurally configured departments, such as the Ministry of Health, prepared the programs of tightening belts. Less flexible and more formidable, for example, the Ministry of Defense, scandalized. However, the limits of scandalousness were narrow - for example, in many ways, the resignation of the Minister of Education Livanov in August was associated with his honest explanations of how many scientists he will have to dismiss from 2017 during the implementation of the requirements of the Ministry of Finance.

Reducing wages at least a third of the population a year before the presidential election has a typical Russian roulette, although with a small number of ammunition in the revolver drum

Apparently, by the beginning of September, the process reached a boiling point, although this was not visible from the outside. By that time, it became finally obvious that the sale of Bashneft and Rosneft was effectively blocked by the head of Rosneft Igor Sechin by agreement with the president, and the budget problems will not work out from privatization. So carefully, without publicity, and began to discuss an emergency increase in taxes.

Roadmap of problems

Three options that this week will be discussed in the government look like this. The first is an increase in value added tax in 2017 or 2018 from the current 18% to 20%. The second is an increase in income tax from the current 13% at once to 20% while maintaining for a significant part of the population receiving average wages, rates of 13%. In fact, we are talking about a two -speed tariff that impedes an increase in salaries for the middle class. The third option is an increase in the release of federal loan bonds from a planned 1 trillion rubles. The next three years to 1.5-2 trillion rubles a year. per year or even more.

In the third version, the federal budget deficit, previously planned in the amount of 3.2 % of GDP in 2017, should increase to 3.5–3.9 % of GDP, and this is the simplest but rather problematic solution. The point is not even that this will once again reduce the sovereign rating of Russia - now it is kept on promises of budget consolidation and confidence of rating agencies in the moderation of the appetites of the Russian government, its sobriety. The problem is that the state, selling OFZ bonds to extra 0.5–1 trillion per year, displaces other borrowers from the market - from Gazprom and Rosneft to regional administrations, in which case they will have to occupy much more. This will immediately affect investments and in six months a year, that is, in 2017, on economic growth. In addition, the capacity of the domestic public debt market can now be increased quickly only by restoring the accumulative component of the pension system or by launching its new segment according to the Central Bank and the Ministry of Finance. Both the White House’s social block considers a catastrophe for his plans, especially since, regardless of the results of the October trading, social contributions will still have to be raised a little - apparently, the abolition of “thresholds” for their payment to the Pension Fund and the Social Insurance Fund.

An option with VAT growth is no less problem. Firstly, a country that urgently raises value added tax is by definition of a country in a problematic economic condition: this is the most effective blow to the investment climate that you can think of. Secondly, an increase in VAT by two percentage points with an increase in its fees by 10% (this is the only tax that the state in Russia has learned to collect almost perfectly in Russia in recent years) is an inevitable surge in inflation since 2017 and, apparently, a brilliant blow to the entire policy of the Bank of Russia, which has reduced inflation to less than 7%. Half of the work of Elvira Nabiullina since the appointment of her head of the Central Bank in this case can be sent to the archive - at least two years after such a decision, the Bank of Russia will have to rake the consequences.

The option with an increase in income tax has long been discussed in the Kremlin and in the White House - personal income tax in Russia is quite low. The only problem is that 2017 after such a decision can be confidently considered lost for restoration economic growth. You can argue about who invests more effectively - a private investor or state, but the expenses of the population, one of the two pillars of internal demand, will always be more effective from this point of view - and even the most stubborn statesman will not argue with this. It will not be arguing for purely political reasons - at least a third of the population has a typical Russian roulette, although with a small number of cartridges in the revolver drum, have a decrease in wages a year before the presidential election.

In many ways, the resignation of the Minister of Education Livanov in August was associated with his honest explanations of how many scientists he will have to dismiss from 2017 when implementing the requirements of the Ministry of Finance

And most importantly, for what is all is the choice between an increase in inflation, a reduction in salaries or a stop of economic growth. What problems does this choice solve? From the Kremlin, he looks, apparently, otherwise than from the street. On the one hand, at the meetings discussing the “alternative budget”, members of the government could personally observe Alexei Kudrin, who continues to prepare the reform program for the authorities for 2017–2024, and many probably understood this hint, especially since the main gossip of the White House is the presidential decisions in the government that allegedly prepared in October. On the other hand, Vladimir Putin realizes better than others that the current personnel of the ministries after a reduction in financing - that is, when implementing initial plans for the budget of the Ministry of Finance - will lose the remnants of enthusiasm. The bench of “spare” is short, new people in power structures rarely appear, and any personnel revolution in recent years is perceived as a possible prologue to the present.

Of course, the budget process in the coming of the week will not lead to the barricades on Presnya, nor to the millionth rallies, or even to the open political struggle. However, the disappearance of the political field and its reduction to an endless demonstration of loyalty to the existing rules of topics are dangerous - sooner or later the economy is connected to the case.

So, it seems, she has already connected.