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export duties, as follows from the explanatory note to the draft three-year budget. Three months before the end of this year, it is planned to collect 150bn rubles, in 2024 - another 600bn, for a total of 750bn rubles. The government announced the introduction of a new duty for exporters from October 1 until the end of 2024, tied to the weakening of the ruble, only last week. Depending on the ruble exchange rate, the duty will be 10% for fertilizer producers and 4–7% for other industries. At an exchange rate of 80 rubles per dollar and below, the duty will be reset to zero. In fact, this is an additional heavy tax on export-oriented businesses, which was discussed little with the latter. For the fertilizer industry, this decision is equivalent to doubling the profit tax in the fourth quarter of this year to 40%.
The Ministry of Finance proposes to levy a duty on exporters who receive “excess profits” due to the weak ruble, which will depend on the exchange rate of the Russian currency. When the dollar is below 80 rubles, the duty will be zero, and when the dollar is higher, depending on the exchange rate, it can vary from 3% to 7%. Different versions of the project give different figures, Interfax writes, the exact amount of the fee has not yet been determined.
6.1.4 Budget dynamics - regions
Four Russian regions face a collapse in budget revenues. Those four Russian regions in the first half of 2023 faced a double-digit drop in tax revenues to local budgets. This data is provided by experts of the Gaidar Institute in their report on the financial condition of the Russian Federation's regions.
The Nenets Autonomous Area has set an antirecord for the reduction of revenues, where the tax collections for 6 months collapsed by 35.1%. Budget revenues of Khakassia decreased by 27.2%; Kemerovo region, the key region of coal production in the Russian Federation, - by 21.7%. St. Petersburg, home to Gazprom's headquarters, lost 13.2% of revenues after gas exports to Europe fell to their lowest level since the mid-1970s.
Twenty-six regions of the Russian Federation had debt loads exceeding 50% of their own annual revenues, while Udmurtia was the anti-record holder, with its debt exceeding 100% of its annual budget. At the end of 2023, 35 regions of the Russian Federation had a budget deficit, and six were forced to spend almost all the money in their accounts to cover it. This is, in particular, the Republic of Tyva, which has "nothing left in its reserves," wrote analysts of Expert RA. Kalmykia, Buryatia, Karelia, Murmansk region, and Chukotka autonomous district also spent almost all of their reserves to cover "holes" in local budgets.
75 RUSSIA Country Report October 2023 www.intellinews.com