Rustam Minnikhanov: ‘You shouldn’t listen to stories, you need to understand the problem in detail’
Rustam Minnikhanov urges to deal with the trend of reducing income tax charges in detail
Income tax revenues decreased by 5 billion for the first quarter of this year, which caused concern to the head of the republic. “The trend here is not very favourable and the outlook is not either. We lost 5 billion rubles, and this is not only due to the work of large taxpayers," Rustam Minnikhanov said, opening a meeting of financial, treasury and tax authorities of the Republic of Tatarstan. In his opinion, it is impossible to “hide behind” sanctions and pricing policy everywhere. “You don't need to listen to stories [about income tax], you need to understand things in detail," he instructed the line ministries, the Ministry of Finance of the Republic of Tatarstan, Federal Tax Service of the Republic of Tatarstan.
Cost of polyethylene and ammonia has fallen for large producers
At the same time, the rais of the republic admitted that the negative price environment played against some large enterprises. “There is a reason to tell, but each case must be considered separately. I understand that the cost of polyethylene and ammonia has fallen for the “big players”, these are understandable things, but there are those who increase their costs and accounts receivable. Let's consider carefully," he protested. At the same time, the debt to the budget increased to 12 billion rubles.
In the first quarter of this year, 43 billion rubles in income tax were collected in the consolidated budget of the Republic of Tatarstan. This is 38% of the annual target. “But many republican companies have submitted tax returns to reduce the calculated tax payable to the budget, both in 2023 and for specified obligations for previous years," said Marat Safiullin, the head of the Federal Tax Service for Tatarstan. According to him, the total fees decreased by 8.9 billion rubles, taking into account 2023.
At the beginning of the year, the Russian economy experienced a slowdown in growth compared to last year. Nevertheless, the first quarter is more favourable in terms of revenue, based on the remnants of last year. In total, 364.1 billion rubles were mobilised to the consolidated budget, or with an increase of 34%. The growth of payments was provided by revenues from oil production, which was facilitated by high oil prices in January-March, income from banking activities against the background of a high key rate of the Central Bank and the IT industry. A decrease in revenues occurred in the energy sector, manufacturing, trade, and construction.
March results are not encouraging
However, personal income tax fees increased by 52%, which is due to wage growth. “But this does not reassure us, we are concerned about the issue of income tax," Rustam Minnikhanov summed up.
At the same time, punitive measures should not dominate. According to Minnikhanov, enterprises need to be helped in expanding sales markets. “We are obliged not only to demand, but also to help promote products on the market in regions and other countries. There are logistics issues, but the most important thing is to ensure strict budget discipline," he concluded.
For the first time, the leadership of the Ministry of Finance expressed concern about a decrease in income tax revenues at the end of February this year. At a special press conference, Deputy Minister Alla Anfimova said that personal income tax collections exceed income tax receipts, which has never happened before. The January monitoring showed that petrochemical revenues have noticeably sunk. With an average monthly income level of 5.4-5.8% for all types of taxes (the minimum required to fulfill the annual collection plan), revenues from petrochemical enterprises fell to the level of 3.1%. Then the leadership of the Ministry of Finance of the Republic of Tatarstan refrained from hasty conclusions, saying that “we need to wait until March”.