the consolidated budgets of the regions following the results of seven months were executed with a surplus of 1.566 trillion rubles.

The consolidated budgets of the Russian regions for the first seven months of 2023 were executed with an impressive surplus of 1.566 trillion rubles, follows from the statistics published by the Ministry of Finance. A year earlier, this figure was only slightly lower – 1.48 trillion rubles.

With an intermediate surplus, the total budget of the constituent entities of the Russian Federation differs markedly from the federal budget, which was closed in January-July with a deficit of 2.817 trillion rubles, or 1.8% of GDP (see Kommersant on August 9). Such a difference in the sign of performance is explained primarily by the different structure of the revenue side. Regional budgets are replenished mainly through income tax and on the income of individuals who have not experienced a drop in revenues. The federal budget is based on VAT and the mineral extraction tax, and production tax revenues fell by about half on the decline in Russian oil prices. In addition, the regions are limited in their ability to increase spending, not having, unlike the federal center, significant reserves and capacious markets for placing bonds to close the deficit.

According to preliminary data from the Ministry of Finance, the regions’ income for seven months is 12.732 trillion rubles, which is 13% more than a year earlier. In this amount, own income – 10.418 trillion rubles, transfers – 2.314 trillion rubles. Own income was divided into three almost equal parts: income tax (3.739 trillion rubles), personal income tax (3.247 trillion rubles) and “other income” (3.433 trillion rubles). The growth rates for these components are different. Collections from the usually stable income tax increased by 38% at once, while the more volatile income tax increased by only 12%. “Other income” added 18% in volume. As for expenses, since the beginning of 2022, the Ministry of Finance has only given their total amount without a breakdown by section – in general, spending for January-July amounted to 11.167 trillion rubles, which is 14% more than a year earlier. Thus, expenses rose almost the same as revenues.

It should be noted that with similar intra-annual dynamics, at the end of 2022, regional budgets were executed with a total surplus of only 50 billion rubles. At the same time, most of the regions ended up with a deficit – 50, surplus – 35. Against the backdrop of a modest result of income tax collections, revenues in 2022 were also drawn primarily by income tax.

Vadim Visloguzov