According to Vladislav Inosemsev, a former Kremlin advisor, Russia’s current economic crisis is likely less a consequence of the war and sanctions and more the result of an ideological shift in policy within Moscow. Speaking to “Spiegel”, Inosemsev asserted that “Vladimir Putin has begun to undermine his own economy”.
The Russian economist diagnoses a “marked break in Russian economic policy”. He points out that at the outbreak of the war, the Russian government had effectively executed “masterful policy”. Regulations and laws were loosened at that time, enabling many companies to overcome the burden caused by sanctions.
However, Inosemsev argues that the Kremlin is now “overburdening the private sector with completely counterproductive taxes and regulations”. For instance, Value Added Tax requirements have been expanded to cover freelancers and small businesses. Because so many of these smaller enterprises have subsequently been forced to close, the intended tax revenue accumulation has, in reality, decreased.
Inosemsev attributes these errors to the President. He claims that for many years, Vladimir Putin allowed his economic experts in the Central Bank and Finance Ministry considerable freedom. Lately, however, these experts have increasingly succumbed to the pressure of hardliners and intelligence agencies. Inosemsev believes that the core tenets of Putin’s old Soviet worldview are currently gaining stronger influence over the President-a desire for absolute control over everything.
Vladislav Inosemsev, who was born in 1968, previously served as President of the “Commission for Economic Modernization” under then-President Dmitry Medvedev, from 2009 to 2011. Today, he works as an Associate Fellow at the British think tank Chatham House and resides in Washington, D.C.
