Page 95 - RusRPTJul22

the media learned about a 130% increase in military spending in April.
As a result, only aggregate figures for expenditures and incomes remained in the published data.
The budget surplus for January-May 2022 amounted to 1.495 trillion rubles, follows from the preliminary estimate of the Ministry of Finance. Data for May is classified. In April, a monthly budget deficit was recorded for the first time.
The volume of all revenues for the five months of this year reached 12.043 trillion rubles (oil and gas revenues amounted to 5.658 trillion rubles, and non-oil and gas - 6.385 trillion rubles). The volume of expenditures for January-May reached 10.5 trillion rubles.
Oil and gas revenues of the budget in annual terms are still growing (+30%; 871.4bn versus 617.6bn rubles), but if compared with the previous month, the dynamics deteriorated sharply. If in April 2022 tax revenues from oil and gas exports amounted to 1.8 trillion rubles, then in May it was already 871.4bn rubles.
Non-oil and gas revenues (VAT, personal income tax, income tax, etc.) continued to decline in annual terms in May and amounted to 1.137 trillion rubles against 1.215 trillion rubles in May 2021 (-6.4%).
Russian government budget revenues weaken in May and high inflation is eroding the stimulus effects. May federal budget revenues were up by just 10% y/y in nominal terms. The rise was gravely insufficient to keep pace with inflation, which has increasingly chewed away at the purchasing power of budget revenues and spending.
The inflation that is relevant for the government purchasing power is proxied mainly by consumer prices and industrial producer prices on domestic deliveries (they were up on the average by about 24% in May). In the first four months of this year, nominal budget revenue growth was still 34% y/y.
The rise in oil & gas tax revenues subsided to around 40% y/y in May after spiking in previous months. Nearly all of the government’s oil & gas tax income is defined in US dollars, so the May slowdown can be largely tied to the fact that the discount price of Urals blend in April was a moderate 13% higher than a year earlier and the ruble’s exchange rate was just a couple of percent lower than a year earlier.
95 RUSSIA Country Report October 2020 www.intellinews.com