Page 59 - RPTRusFeb17

The city of Moscow in 2016 generated record revenues of RUB1.852trillion (€30bn), up 11% year-on-year, Vedomosti daily reported on February 12. Most of the money came from an 18% increase in profit tax to RUB572bn. Of this amount, one fifth came from state lender Sberbank, the city's largest single contributor of tax on profit, according to a source of the newspaper, although the bank declined to comment. The record revenues contrast sharply with growing indebtedness of many of Russia's 85 regions. Moscow's spending last year totalled RUB1.73trillion. Of the earnings, the city hall last reaped a bumper RUB17.5bn (€284mn) from car parking alone, mainly in fines, as the capital steps up its war on traffic jams declared by Moscow Mayor Sergei Sobyanin when he was appointed in 2010. The sum is comparable to the entire annual budget of some cities, for example the Tatarstan capital Kazan (RUB19bn), Fitch Ratings' senior director Vladimir Redkin told the newspaper. Most of the money came from fines rather than parking fees (RUB11.3bn), up 11.8% on 2015, with the total from both urces growing eight times since 2012.
The number of regions with debt exceeding a dangerous threshold of 100% of the region’s budget revenue rising. I n 2016, the average level of debt burden of Russian regions stood at 36.4%, which is acceptable. “But the debt burden of eight of them exceeded 100% of the expected revenue, and the debt burden of 12 of them exceeded 85%, and is likely to top 100% in 2017,” the ministry said. It said that a high cost of the borrowed funds and a low flexibility of regional budgets creates risks, as the 20 regions account for almost 20% of the combined regional debt, or RUB446bn.
Tax and non-tax revenues of the Russian regions increased by 20% compared to the same period in 2016 in January - February, said Finance Minister Anton Siluanov, speaking at a meeting between Prime Minister Dmitry Medvedev with the governors on inter-budgetary policy, Vedomosti reported. According to Medvedev, with the 2016 deficit of regional budgets has decreased from RUB170bn to RUB12.5bn. But the debt burden remains significant. "The situation remains difficult. There are a number of positive changes, but there must be more . “ The number of regions were the debt is larger than the regional income has been reduced, but overall debt burden remains very important and very big,” Russian prime minister Dmitry Medvedev.
59 RUSSIA Country Report February 2017 www.intellinews.com