Inequality is expected to decline

In the new issue of the Monitoring of Russia’s Economic Outlook, experts at the Gaidar Institute analyzed the situation with income inequality in the Russian Federation. It is noted that Rosstat recorded the minimum indicator over 20 years of observations in 2022 (reflecting the degree of inequality, the Gini coefficient was equal to 0.398). In 2023 and 2024, it rose to 0.405 and 0.408, respectively. The maximum ratio of 0.422 was registered in 2007.

Experts note that in a favorable economic situation, the richest households get richer faster than others and this contributes to a growing income gap. Thus, inequality in the Russian Federation increased during the periods of economic growth and, by contrast, decreased during the periods of crises and recessions. To understand the picture, IEP experts analyzed income-stratified dynamics across 80 regions of the Russian Federation.

In 2023, inequality increased in almost all regions, except for Dagestan and Ingushetia, where the indicators remained unchanged. In 2024, the Gini coefficient actually returned to the 2021 level. These changes were probably driven by the recovery of regional economies after the difficulties seen in 2022, an increase in government investments in the military industry, as well as a temporary decrease in business incomes in 2022 with their subsequent growth in 2023–2024.

Given the current forecasts of Russian economic growth slowdown (overheating of the economy is expected to come to naught, and the actual growth rate, to approach the potential one), Gaidar Institute experts expect inequality growth to stop in 2025 and remain at the level seen in 2021 (or even below).

In the current situation, analysts suggest that the authorities pay more attention to measures aimed at supporting socially vulnerable groups of the population, particularly, timely indexation of pensions and social benefits, the development of retraining and employment programs, as well as promotion of targeted support to reduce potential social tensions that may arise amid growing inequality. Also, experts believe that the modification of the tax system in 2025–2026 can curb inequality; this means income equalization using a new personal income tax scale and the introduction of a tax «cashback» for poor families with children.