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Profit Tax Pulls Its Budget Weight
Russian Federal Tax Service data on the structure of April tax revenue indicate continuing economic growth and the emergence of the economy from the shadows. The most dynamically growing source of budget income between January and April, the data show, is still the profit tax, which account for nearly a third of it. Budgets at all levels received 3.432 trillion rubles through the tax service in that period, 50.8 percent more than in the same period of last year. The federal budget and regional budgets received 14.6 trillion rubles (increases of 57% and 53.1%, respectively). The Pension Fund, Social Insurance Fund and federal and territorial medical insurance funds received 496 billion rubles each (a 29% increase). Tax collection is running ahead of plan, having fulfilled it by 39.4 percent, rather than by one-third.
The profit tax remains the most important for the budget system. It is the source of 32.3 percent of all tax revenue and its growth since the same period of last year was 87.3 percent. That is explained by the growth of the stock market and the legalization of certain business transactions. Large companies, particularly oil companies, had a large influence on its growth as well. In second place by revenue is mineral use tax, with 537.2 billion rubles, up 64 percent over last year. Most of it (491 billion rubles, up 72.7 percent) came from oil production.
VAT was in third place, with 465.4 billion rubles, up 53.9 percent. This is the first time April VAT payments were made known. They totaled about 350 billion rubles. There were expectations that the transition to quarterly VAT payment would destabilize the money market. VAT revenue grew significantly faster than producers’ prices (27.4% from March to March). That and 8-percent economic growth indicate that businesses are emerging from the shadow economy. Personal income tax revenues lagged only slightly behind VAT, with 461.2 billion rubles, up 37.7 percent. That tax revenue is growing faster than personal incomes (about 25% annually), which is also indicative of increasingly legal tax dealings, as well as “work by the tax service with companies.” The fact that personal income tax revenues are growing faster than single social tax revenues (in fifth place at 152.1 billion rubles, up 31.1%) indicates that differentiation of incomes levels is continuing. The five taxes mentioned account for 87.5 percent of budget income. Last year, that figure was 84 percent.
www.kommersant.com
All the Article in Russian as of May 23, 2008
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