Content №2 от 2022
Revenue of Russian Sub-Federal Budgets Under the Pandemic: a Spatial Reversal
The article studies consolidated budget revenues of Russia’s constituent entities. The purpose of our research is to analyze how the pandemic impacts the dynamics of sub-federal budget revenues and to assess contributions from various sources (tax, non-tax revenues, gratuitous receipts, and their components) to their change.
From the data on moving annual totals for sub-federal budgets and their components with a one-month shift, we construct linear time regressions for 86 constituent entities of the Russian Federation from 2015 till March 2020. They are used to forecast non-pandemic revenues of local budgets during the pandemic (April 2020 till June 2021). By decomposing deviations of the actual revenues from the forecast ones, we determine the contribution of different sources to changes in local budget revenues amid COVID-19.
The entities of the Ural Federal District and a few other oil-producing regions showed the greatest vulnerability to the pandemic. At the same time, an abnormally high growth in budget revenues was observed in some regions of the Far Eastern Federal District. Tax revenues had the greatest negative impact on the change in sub-federal budget revenues, where income tax provided most losses. Smaller disbenefits were associated with corporate property tax and special tax regimes. Personal income tax partially compensated for their shortfall. The change in taxes on goods and services was extremely uneven. Non-tax budget revenues followed tax ones, and the use of state property and sale of assets generated the largest losses. Interbudgetary transfers compensated for both the shortfall in own revenues and the growing regional expenditures. Their distribution reveals three motives: pandemic mitigation, regulation of interregional imbalances, and political preferences. Entities of the North Caucasian Federal District and some other lagging republics received a large fraction of additional transfers. Their structure is marked by a significant increase in the share of subsidies and other interbudgetary transfers, which reflected the state’s active participation in national projects and creating public goods. A decrease in the share of equalization grants implies a reduction in non-targeted aid allocated in accordance with uniform rules. This testifies to the state’s ever-growing dirigiste function in the economy.
The results obtained are applicable to governing budgetary revenues in Russian regions, as well as regulating interbudgetary relations during crises.
