Tax proceedings to Russia's consolidated budget increased by 20% in 2017, amounting to 17.3 trillion rubles, the head of the Russian Federal Tax Service, Mikhail Mishustin, said today.
The increase in tax proceedings was 3.1% of GDP, and its main growth drivers were the profit tax and VAT. In particular, the profit tax amounted to 3.3 trillion rubles, increasing by 18.8%, and VAT showed an increase of 15.5% to 3.1 trillion rubles. In total, the federal budget received 9.2 trillion rubles last year, and the total increase was 32%.
The greatest increase in revenues of 60% or 1.7 trillion rubles was provided by non-oil revenues. Excise revenues also increased - by 17.6%, to 1.5 trillion rubles, property taxes - by 11.9%, to 1.2 trillion rubles, personal income tax - by 7.7%, to 3.3 trillion rubles, RBC reports.
The Federal Tax Service has repaid 173 billion out of 522 billion rubles of debts in respect of insurance contributions," Mishustin said, adding that its significant share was accumulated debts of individual entrepreneurs, which amounted to 111 billion rubles as of early 2018," Mishustin said.
The vice-rector of the Academy of Labour and Social Relations Alexander Safonov, speaking to a correspondent of Vestnik Kavkaza, noted that the tax collection rate increased due to the collection of debts and the growth of the tax base. "The FTS in the course of the 2017 tax collection campaign was solving several tasks, and the first of them was the recovery of those debts accumulated over the period from 2015 to 2016. The second task was to review the grounds for paying taxes at the growth of the tax base. For example,a real estate tax - many regions have started to calculate its size from the cadastral value," he explained.
Thus, the increase in proceedings to the consolidated budge by 20% and 32% to the federal budget does not indicate the growth of the Russian economy. "As you can see, it is possible to increase the tax collection rate even when there is practically no economic growth and the population's incomes are declining. Macroeconomic indicators cannot provide such an increase in tax revenues to the budget, but there are others tools. For example, an increase in the collection of VAT does not indicate an increase in consumption, but suppression of schemes for avoiding VAT payments. The increase in the collection rate of personal income tax also does not mean the withdrawal of some workers from the shadow economics, but rather says about working with debts on this tax," Alexander Safonov drew attention.
A professor of the RANEPA Chair of Economics and Finance of the Public Sector, Lyudmila Pronina, also explained the increase in tax collection rate by the optimized work of tax authorities. "The fiscal performance has risen from 93% to 97%, and the growth of tax revenues was primarily ensured by more effective administration. In addition, there is higher output growth in some industries - chemical, processing, light, agriculture and machine building - which means that the profit tax is growing," she said.
The expert also noted the importance of the growth of small businesses. "With regard to personal income tax, it is a matter of wage growth: according to statistics, both salaries and real incomes of the population increased in 2017. The contribution was also made by an increase in the minimum wage to the subsistence minimum level. It should be added that it is quite logical that the income tax and personal income tax showed high growth in the structure of federal budget revenues, since they are key sources of tax revenues for it - but still the main role was played by better administration of the Federal Tax Service's work," Ludmila Pronina concluded.
