Russia may waive payment of funded pensions, raise taxes

"It is complicated to increase the burden in our country significantly. I don’t rule out that it may be increased due to the fact that we have not increased the retirement age and also due to the fact that the financial challenges remain in place for the next five to ten years," Kudrin said at the annual meeting of the Board of Governors of the World Bank and the IMF in Peru.

He explained that even if the government increases the retirement age in the coming years, it will happen gradually, and the budget will still need additional resources to finance the deficit of the Pension Fund.

Read alsoRBC: Russian operation in Syria may cost Russian Gazprom $9.2 bln a year"So this burden will in some way fall on the shoulders of the employers or citizens. Actually, we can’t evade it," said Kudrin. Ex-finance minister believes that the government has already decided to take these steps, by withdrawing additional revenues of oil companies and freezing pension savings. However, he said that "these sources have already been exhausted."

Kudrin also said that soon the question may arise about the introduction of a progressive tax scale for individuals. "Theoretically, when the burden increases on the citizens, it is always the question of who should pay more: the poor or the rich? Should the burden be distributed evenly? A public debate will rise immediately, and the question of a progressive scale will come up again," he said.

Read alsoKudrin: Russia may lose up to $200 bln in 3-4 years due to Crimea annexationIn addition, according to Kudrin, the Russian authorities may waive payment of funded pensions. "There is even a risk that the government will generally give up on the accumulative part of pensions due to the current financial situation," said Kudrin. Russia has already practiced freezing the pension savings, said the ex-minister, and this practice may be continued.