Page 53 - RusRPTAug19

6.0 Public Sector 6.1 Budget
The Russian Federation budget is in surplus. In January-June, budget revenue increased by 10% y/y in nominal terms. The growth rate of revenues was quite good in that the surge in oil and gas tax revenue, which has risen sharply, is behind us. Oil and gas tax revenues were only 5% higher in January-June than a year earlier. Other budget revenue increased by 14%, which was somewhat supported by the revenue accruing at the beginning of the year from revenue accruing to the budget in the second quarter.
In January-June, federal budget expenditures increased only 3% year-on-year, ie slower than inflation. Defense spending fell slightly. Budgetary spending is set to start to grow more vigorously in the second half of the year, as President Putin's national projects in May 2018 are getting better off. The budget estimate for the full year, including the recently adopted small additional budget, aims to increase expenditure by almost 10% over last year. Defense spending is planned to increase by 3-4%.
The sharp rise in federal budget revenue and the slow growth of expenditure this year have raised the budget surplus, which has remained at over 3% of GDP in recent months over the past few months. For the whole year, the Ministry of Finance estimated a surplus of 1.7% of GDP if the price of Urals oil was over $63 a barrel (the average price in January-June was just under $66).
53 RUSSIA Country Report August 2019 www.intellinews.com