Researcher at the Gaidar Institute’s Budget Policy Laboratory Alexander Deryugin discusses the RF Ministry of Finance’s plans to raise the investment threshold for the NWF. The expert’s opinion is published by Davydov.Index.

“Both Russia and other countries came out of the economic crisis of 2020 quite quickly – this can be seen both in the stock market and in the economic indicators. However, there are some reasons to expect that the next crisis may happen soon enough. We are more or less accustomed to the fact that a global economic crisis occurs about once every 10 years. So, economists suspect that the next one may arrive earlier, perhaps in 5-6 years. By that time, Russia should accumulate a normal volume of reserves. A lot of money was spent on fighting the crisis in 2020, but we will probably have less time for saving money for a new crisis this time.

Therefore, the government now imposes taxes on all excess profits – those of metallurgists, fertilizer producers, and so on. And all this money will go, directly or indirectly, to the NWF. In short, my vision of what the government is doing now is this: having realized that a new crisis will come much earlier than could be normally expected, it is trying to pump as much money as possible into the NWF. And these actions are logical in principle. As well as the fact that the investment threshold is raised - because at the moment, the parameters of the next crisis are not yet clear. It is only clear that it will happen, and soon.

Of course, the government does not say that there will be a crisis – why frighten people long in advance of such a crisis? Those who understand the situation, know without any hints that the crisis will come. We can see that the central banks in Europe, and now also in China, are blissfully pouring massive amounts of money into the economy. We see how the inflationary spiral is unfolding, and not only in this country, but throughout the world. Our inflation has already reached 7%, if you look at the year-on-year data. That is well above the target. In the USA, industrial inflation during one of the summer month jumped above 8%. This is also a very serious indicator.

As world inflation is beginning to surge, many sectors of the economy gain additional profits. So, now our taxation system will be flexibly adapting to these changes, redistributing the tax burden across all the sectors of the economy. And we will intensively build up the NWF in order to meet the future crisis,” the expert believes.