Session of the Federation Council of Russia. Table of growth rates of territorial budgets income, without taking into account receipts from the oil company "YUKOS" for the first quarter 2004-2005, is on the screen.
Photo: Dmitry Dukhanin
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Budget Lacks YUKOS Money
// The government will have to borrow at the domestic market
Group of United Russia deputies initiated amendments to the 2007-budget law in the State Duma on Wednesday. The amendments distribute a part of YUKOS’ 392-billion-ruble tax arrears to the budget’s articles of expenditure. The draft allows the government to borrow up to 100 billion rubles at the domestic market. There is already not enough money for the government’s initiatives for implementing the president’s budget address. Moreover, the government now expects the value added tax revenues to decrease in 2007.
The draft bill “About making amendments to the law ‘About the federal budget for 2007’” was introduced to the State Duma on Wednesday. It was developed by the Finance Ministry in accordance with President Vladimir Putin’s budget address. Introducing the draft bill by Duma deputies considerably speeds up the procedure of the draft’s consideration. The Finance Ministry is thus avoiding the necessity to coordinate the draft in other federal agencies.
The president said in his address that the money coming from settling YUKOS’ tax debts should be used for building and reconstruction of roads, repair of dilapidated housing, resettling of citizens living in it, and for nanotechnology development. On May 20th, the State Duma passed the law on centralizing the 392 billion rubles of YUKOS’ tax arrears in the federal budget. Last Wednesday and Friday, the State Duma passed in the first reading the projects for creating a corporation for nanotechnology development and a fund for reforming the housing maintenance infrastructure. In the course of 3 years, the corporation will receive 130 billion rubles, and the fund – 240 billion rubles.
The amendments suggest distributing 30 billion rubles of YUKOS money for “creating an effective transport system as an element of the future growth’s infrastructure”. Out of this sum, 20 billion rubles will be given to cities, for developing street and road network; 7.8 billion rubles – to regions, for building and reconstruction of public highways; 2.2 billion rubles – for building and reconstruction of federal highways. Ten billion rubles will go to complete repair of housing and resettling citizens from the accommodation in dangerously bad condition; 1.9 billion rubles – for creating the president’s library named after Boris Yeltsin; 2.9 billion rubles – for nuclear and radiation security events and for strengthening the scientific and research potential.
Beside the YUKOS money, ‘budget economy” will be used as well, said Vitaly Shuba, deputy head of the Budget Committee. For instance, it will finance the project of proving expensive medical drugs for citizens: 47 billion rubles will be spent on it within these 3 years.
Obviously, the YUKOS money is not enough for covering all the planned expenditures. Apparently, the stabilization fund, along with the budget, will be used for financing the nanotechnologies and the housing maintenance. So far, no one in the State Duma is ready to comment neither on this circumstance, nor on the draft bill’s article allowing the government to increase borrowings at the domestic market by 100 billion rubles. Thus, a “hole” might appear in the budget, due to the decrease in VAT revenues (up to 716 billion rubles by the year’s end) due to the change in administrating the tax and due to the overstatement of the calculated prices on oil in the draft budget. Anyway, the YUKOS’ money will not help the Finance Ministry to solve the problem of the growing financing deficit in the 2007 budget.
“We plan to finally pass the bill next week,” said one of its authors, head of the State Duma’s Industry Committee Martin Shakkum. Today, the bill will be discussed at the Budget Committee’s session.
Irina Granik
All the Article in Russian as of June 21, 2007
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