Capital Flight from Russia and Possible Sources of Financing Budget Expenditures
The article considers the problems of capital flight from Russia in current conditions and the related problems of financing budget expenditures. The difference between capital export and capital flight, which occurs in conditions of extremely high risks or unfavorable investment climate, is substan...
| Main Author: | |
|---|---|
| Format: | Article |
| Language: | English |
| Published: |
Financial Research Institute
2023-12-01
|
| Series: | Финансовый журнал |
| Subjects: | |
| Online Access: | https://www.finjournal-nifi.ru/images/FILES/Journal/Archive/2023/6/statii/02_6_2023_v15.pdf |
| _version_ | 1797382426142441472 |
|---|---|
| author | Pavel E. Zhukov |
| author_facet | Pavel E. Zhukov |
| author_sort | Pavel E. Zhukov |
| collection | DOAJ |
| description | The article considers the problems of capital flight from Russia in current conditions and the related problems of financing budget expenditures. The difference between capital export and capital flight, which occurs in conditions of extremely high risks or unfavorable investment climate, is substantiated. The balance of payments of Russia in 2022 is analyzed, and it is substantiated that in the current situation capital flows are largely capital flight from political and economic risks. The author estimates the size of capital flight from Russia in 2022 (approximately $232 billion), and concludes that the mandatory sale of foreign exchange earnings in modern conditions can be replaced by more flexible control measures. Further, the paper analyzes a set of complex problems of financing the federal budget expenditures of Russia in the current conditions. Three possible mechanisms of financing the budget deficit (or additional expenditures) are considered: at the expense of new public debt, at the expense of the National Welfare Fund and sale of state assets, as well as at the expense of new emergency taxes. It is concluded that attraction of new sources for government borrowing is practically impossible without a significant increase in interest expenditures. At the end of the paper, for the recovery of the Russian economy, there is a proposal to introduce a new flexible tax on the export of capital, which can create incentives for investment in the Russian economy and solve the problems of financing federal budget expenditures in modern conditions. |
| first_indexed | 2024-03-08T21:06:12Z |
| format | Article |
| id | doaj.art-1ea933843adc4a359e95b39a7d247856 |
| institution | Directory Open Access Journal |
| issn | 2075-1990 2658-5332 |
| language | English |
| last_indexed | 2024-03-08T21:06:12Z |
| publishDate | 2023-12-01 |
| publisher | Financial Research Institute |
| record_format | Article |
| series | Финансовый журнал |
| spelling | doaj.art-1ea933843adc4a359e95b39a7d2478562023-12-22T12:36:25ZengFinancial Research InstituteФинансовый журнал2075-19902658-53322023-12-01156274210.31107/2075-1990-2023-6-27-42Capital Flight from Russia and Possible Sources of Financing Budget ExpendituresPavel E. Zhukov0https://orcid.org/0000-0003-0951-7164Financial University under the Government of the Russian Federation, Moscow, Russian FederationThe article considers the problems of capital flight from Russia in current conditions and the related problems of financing budget expenditures. The difference between capital export and capital flight, which occurs in conditions of extremely high risks or unfavorable investment climate, is substantiated. The balance of payments of Russia in 2022 is analyzed, and it is substantiated that in the current situation capital flows are largely capital flight from political and economic risks. The author estimates the size of capital flight from Russia in 2022 (approximately $232 billion), and concludes that the mandatory sale of foreign exchange earnings in modern conditions can be replaced by more flexible control measures. Further, the paper analyzes a set of complex problems of financing the federal budget expenditures of Russia in the current conditions. Three possible mechanisms of financing the budget deficit (or additional expenditures) are considered: at the expense of new public debt, at the expense of the National Welfare Fund and sale of state assets, as well as at the expense of new emergency taxes. It is concluded that attraction of new sources for government borrowing is practically impossible without a significant increase in interest expenditures. At the end of the paper, for the recovery of the Russian economy, there is a proposal to introduce a new flexible tax on the export of capital, which can create incentives for investment in the Russian economy and solve the problems of financing federal budget expenditures in modern conditions.https://www.finjournal-nifi.ru/images/FILES/Journal/Archive/2023/6/statii/02_6_2023_v15.pdfforeign direct investmentcapital flightcapital exportbudget revenuesbudget deficitemergency tax |
| spellingShingle | Pavel E. Zhukov Capital Flight from Russia and Possible Sources of Financing Budget Expenditures Финансовый журнал foreign direct investment capital flight capital export budget revenues budget deficit emergency tax |
| title | Capital Flight from Russia and Possible Sources of Financing Budget Expenditures |
| title_full | Capital Flight from Russia and Possible Sources of Financing Budget Expenditures |
| title_fullStr | Capital Flight from Russia and Possible Sources of Financing Budget Expenditures |
| title_full_unstemmed | Capital Flight from Russia and Possible Sources of Financing Budget Expenditures |
| title_short | Capital Flight from Russia and Possible Sources of Financing Budget Expenditures |
| title_sort | capital flight from russia and possible sources of financing budget expenditures |
| topic | foreign direct investment capital flight capital export budget revenues budget deficit emergency tax |
| url | https://www.finjournal-nifi.ru/images/FILES/Journal/Archive/2023/6/statii/02_6_2023_v15.pdf |
| work_keys_str_mv | AT pavelezhukov capitalflightfromrussiaandpossiblesourcesoffinancingbudgetexpenditures |