Putin announces foundation to support seriously ill children funded by income tax increase for high-earners

Russian President Vladimir Putin has signed an executive order on establishing a foundation to support children with serious illnesses. As explained during a meeting on social issues on Tuesday, January 5, the foundation will be financed through an increase in personal income tax for citizens who earn more than five million rubles ($67,600) annually.

Here on my desk I have a draft Executive Order on establishing a fund, as we have agreed, a fund to support children with serious, life-threatening, and chronic illnesses, including rare, or orphan, diseases. We have decided to call this fund the Circle of Kindness.

According to Putin, the foundation’s funding will come from taxing “not the first five million, but everything that’s above five million,” which is expected to bring in about 60 billion rubles ($810 million) in additional revenue.

Deputy Prime Minister Tatyana Golikova said that the Health Ministry had already compiled a list of 30 diseases that the foundation will help treat. Children in need will be provided with medicines, as well as medical devices and rehabilitation equipment. The majority of the foundation’s budget — 47 billion rubles (nearly $635 million) — will be spent on providing patients medications.

It’s expected that four thousand of our little patients should fall into the category of children who will have to receive treatment.

• In June 2020, Vladimir Putin announced plans to increase personal income tax for Russian citizens who earn more than 5 million rubles per year from 13 percent to 15 percent as of January 1, 2021. He promised that the additional revenue from this reform (estimated at up to 60 billion rubles per year) would be used to fund treatment for children with rare diseases.
• Putin signed the increase in personal income tax into law in November 2020.